Calabrese, J. & Shirk, D. v. Zeager, P. ( 2015 )


Menu:
  • J-A14022-15
    NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
    JOHN J. CALABRESE AND DEBORAH J.                   IN THE SUPERIOR COURT OF
    SHRIK                                                    PENNSYLVANIA
    Appellee
    v.
    P. THOMAS ZEAGER
    Appellant                 No. 1849 MDA 2014
    Appeal from the Judgment Entered October 14, 2014
    In the Court of Common Pleas of Lancaster County
    Civil Division at No(s): Cl-04-05070
    BEFORE: BENDER, P.J.E., JENKINS, J., and STRASSBURGER, J.*
    MEMORANDUM BY JENKINS, J.:                               FILED JUNE 01, 2015
    Appellant P. Thomas Zeager appeals from the order of the Lancaster
    County Court of Common Pleas granting summary judgment in favor of
    Appellees John J. Calabrese and Deborah J. Shirk, entering judgment in
    favor of Calabrese and Shirk, and awarding damages in the amount of
    $158,667.22.1       We affirm the grant of Calabrese and Shirk’s motion for
    summary judgment.           We remand for the trial court to award an offset for
    costs Calabrese and Shirk would have paid to connect to Zeager’s sewage
    treatment plant.
    ____________________________________________
    *
    Retired Senior Judge assigned to the Superior Court.
    1
    The trial court awarded $50,372.83 in damages, $20,071.74 in statutory
    interest, $3,378.25 in costs of litigation, and $84,844.40 in legal fees.
    J-A14022-15
    The trial court summarized the factual and procedural history as
    follows:
    In 1991, Edwin G. Hershey owned a hotel and restaurant
    complex known as Hershey Farms on Route 896 in
    Strasburg Township, Lancaster County. As public sewer
    was not available in that area, Hershey built his own
    sewage treatment plant on his property. Sanford M. Groff
    owned an adjoining retail property. On November 22,
    1991, Hershey and Groff entered into a Sanitary Sewer
    Easement and Sewage Treatment Agreement (the
    Agreement) which generally stated that Groff was
    permitted to use the sewage plant located on Hershey’s
    land in exchange for $25,000.00.           Specifically, the
    Agreement granted an easement across Hershey’s land for
    the installation, repair, maintenance and operation of an
    eight[-]inch sewer line which Groff could use to construct
    sewer lines to connect to the plant at such time in the
    future as Groff deemed necessary.          The Agreement
    between the parties had an explicit provision that it was
    Hershey’s obligation to be physically and legally capable of
    allowing Groff to hook into the facility “at all times and
    under all conditions.” The Agreement also contained an
    indemnification clause providing that should Hershey
    breach the agreement, Groff would be entitled to all costs,
    damages, and attorney’s fees resulting from the breach.
    Subsequent to the Agreement, Groff sold his property to
    Calabrese [and Shirk], and Hershey sold his land to
    Zeager. At the time of sale, Groff had not connected to
    the sewage treatment plant located on Hershey’s property.
    Calabrese [and Shirk] and Zeager remained obligated by
    the Agreement, however, which was binding on successors
    in title to Groff and Hershey.
    In the fall of 2003, Calabrese [and Shirk] entered into a
    lease agreement with a new retail tenant which required
    renovation and enlargement of [their] building. Calabrese
    [and Shirk’s] existing on-lot septic system was incapable
    of handling the required additional capacity generated by
    the expansion. Therefore, Calabrese [and Shirk] decided
    that [they] wished to tap into the sewer treatment plant
    on the Zeager property. Calabrese [and Shirk] made
    -2-
    J-A14022-15
    multiple attempts by telephone and letter to contact
    Zeager to tell him that [they] now wanted to utilize the
    sewer capacity that had been paid for years before by
    Groff. Calabrese [and Shirk] eventually learned that
    Zeager did not have the necessary legal approvals to add
    Calabrese [and Shirk’s] discharge. Calabrese [and Shirk
    were] then forced to construct a new “sand mound” septic
    system on [their] own property at a total cost of
    $34,275.33. [They] also incurred costs related to the
    construction, such as lost rent and attorney’s fees.
    Repeated requests were made to Zeager to pay all such
    costs of the new system (as required by the
    indemnification provision in the Agreement). Zeager
    refused.
    Calabrese [and Shirk] brought a breach of contract action
    against Zeager on May 28, 2004, based upon the
    Agreement entered into by their respective predecessors in
    title. Both parties agreed that the Agreement permitted
    Calabrese [and Shirk] to construct a pipe to connect with
    Zeager’s sewage plant and required Zeager to accept and
    treat the sewage.      The parties disagreed, however,
    regarding which party bore the responsibility under the
    Agreement for obtaining the necessary government
    approvals to allow Calabrese [and Shirk] to connect [their]
    sewage pipe to Zeager’s plant. This apparently involved
    the preliminary submission for approval of a sewage
    module plan to Strasburg Township, pursuant to its
    ordinances and to the regulations of the Pennsylvania
    Department of Environmental Resources.
    After the pleadings were closed, this matter was assigned
    to the Honorable Paul K. Alison for a pretrial conference on
    July 29, 2005.       After four joint motions for trial
    continuances by the parties, the case eventually proceeded
    to a non-jury trial before Judge Allison on September 19
    and 20, 2006. Following the filing of proposed findings of
    fact and conclusions of law by the parties, Judge Allison
    rendered a decision on January 25, 2007 (docketed on
    January 26, 2007). The trial court concluded that, under
    the terms of the Agreement, Calabrese [and Shirk] bore
    the responsibility for obtaining official approval of the
    connection to Zeager’s sewage plant, and judgment was
    entered in Zeager’s favor.
    -3-
    J-A14022-15
    Calabrese [and Shirk] filed a timely post[-]trial motion,
    which was denied by Judge Allison on March 19, 2007.
    Thereafter, Calabrese [and Shirk] appealed the trial court’s
    ruling to the Superior Court. On May 22, 2009, a three-
    judge panel of the Superior Court reversed the trial court
    in a published opinion.
    The appellate court held that “the trial court misinterpreted
    the terms of the Agreement and that the Agreement
    unambiguously assigns to Zeager the responsibility for
    obtaining the governmental approval for connecting
    Calabrese and Shirk’s sewage line to Zeager’s sewage
    treatment facility.”
    Zeager filed an application for reconsideration on June 5,
    2009, which was denied by the Superior Court on August
    4, 2009. No petition for allowance of appeal was filed with
    the Supreme Court of Pennsylvania, and the case was
    thereafter remanded to the trial court.
    Following the remand, Calabrese [and Shirk] filed a motion
    for judgment on September 13, 2011, to which Zeager
    responded with a cross motion for judgment on October 3,
    2011. Zeager also filed on October 31, 2011, a motion to
    amend his answer to the complaint to plead actual
    planning and construction costs for a new sewage
    treatment plant built in 2009, following the remand of this
    case, as an offset to any of Calabrese [and Shirk’s]
    damages. Finally, a motion for post remand evidentiary
    hearing was filed by Zeager on October 31, 2011.
    These matters were assigned to the Honorable Jeffery D.
    Wright on December 15, 2011, following Judge Allison’s
    retirement from the bench. Following a status conference
    on February 27, 2012, Judge Wright sent the parties to
    mediation through the Lancaster Bar Association. The
    mediation concluded without a successful resolution. Two
    subsequent attempts at mediation by Judge Wright in
    September and October of 2012 ended again without
    success.
    This case was then reassigned to the Honorable Louis J.
    Farina.  Following a case management conference on
    January 23, 2013, Judge Farina entered an order docketed
    on January 25, 2013, which allowed Zeager to amend his
    answer to plead a claim for offset damages related to the
    -4-
    J-A14022-15
    post[-]trial construction of his new sewer plant, set a
    discovery schedule, and invited dispositive motions. The
    Order further noted, in an apparent response to Zeager’s
    motion for a post[-]remand evidentiary hearing, that
    “[a]ny bench trial will be limited only to a determination of
    the amount of damages to which [Calabrese and Shirk are]
    entitled resulting from [Zeager’s] breach of contract.
    [Zeager’s] liability to [Calabrese and Shirk] for breach of
    contract was finally determined by the judgment of the
    [S]uperior [C]ourt. The only remaining issue is damages,
    allowable attorney’s fees and costs.”
    On November 12, 2013, Calabrese [and Shirk] filed a
    motion for summary judgment. Following the filing of
    briefs by the parties, the case was reassigned to this
    [c]ourt on May 9, 2014. Oral argument on the summary
    judgment motion was scheduled for August 4, 2014, and
    then rescheduled, upon request of Zeager, to September
    19, 2014. On October 14, 2014, I entered an [o]rder
    granting Calabrese [and Shirk’s] [m]otion for [s]ummary
    [j]udgment and entered judgment in favor of Calabrese
    [and Shirk] and against Zeager as follows: (1) damages in
    the amount of $50,372.83; (2) statutory interest from
    March 23, 2007, through November 12, 2013, in the
    amount of $20,071.741 (3) costs of litigation in the
    amount of $3,378.25; and (4) legal fees through
    November 12, 2013, totaling $84,844.40.           The total
    judgment was $158,687.22, before additional legal fees
    and interest to be awarded in an amount to be determined
    upon submission of a supplemental bill of costs and fees by
    Calabrese within ten days of the [o]rder. Calabrese [and
    Shirk’s] supplemental bill of costs was filed on October 23,
    2014.
    The same date, Zeager filed a post[-]trial motion
    challenging the [c]ourt’s order granting summary
    judgment. However, because Pa.[]R.Civ.P. 227.1(a) states
    that a post[-]trial motion does not apply to summary
    judgment motions, Zeager then filed a direct appeal to the
    Superior Court on November 3, 2014.
    Trial Court Opinion, 12/16/2014, at 1-7. Both Appellant and the trial court
    complied with Pennsylvania Rule of Appellate Procedure 1925.
    -5-
    J-A14022-15
    Zeager raises the following claims on appeal:
    A. Did the [t]rial [c]ourt incorrectly determine that, post-
    remand, it was precluded from reviewing the issue of
    whether [Calabrese and Shirk] gave Zeager sufficient
    notice of [Calabrese’s and Shirk’s] desire to connect, the
    evidence of record establishing that [Calabrese and Shirk]
    did not give Zeager reasonable notice under the governing
    circumstances?
    B. Where the trial court acknowledged that damages
    offsets existed, was it error for the [t]rial [c]ourt to not
    reduce its damages award by the amount of the offsets, in
    particular offsets relating to the contractual liability
    [Calabrese and Shirk] would have had for new plant
    reconstruction had [Calabrese and Shirk] connected to the
    old plant?
    Appellant’s Brief at 4.
    “[S]ummary judgment is appropriate only in those cases where the
    record clearly demonstrates that there is no genuine issue of material fact
    and that the moving party is entitled to judgment as a matter of law.”
    Summers v. Certainteed Corp., 
    997 A.2d 1152
    , 1159 (Pa.2010) (quoting
    Atcovitz v. Gulph Mills Tennis Club, Inc., 
    812 A.2d 1218
    , 1221
    (Pa.2002)). A “trial court must take all facts of record and reasonable
    inferences therefrom in a light most favorable to the non-moving party” and
    “must resolve all doubts as to the existence of a genuine issue of material
    fact against the moving party.” 
    Id. (citing Toy
    v. Metropolitan Life Ins.
    Co., 
    928 A.2d 186
    , 195 (Pa.2007)). Therefore, a trial court “may only grant
    summary judgment ‘where the right to such judgment is clear and free from
    all doubt.’” 
    Id. (quoting Toy,
    928 A.2d at 195). This Court “may reverse a
    grant of summary judgment if there has been an error of law or an abuse of
    -6-
    J-A14022-15
    discretion.”    
    Id. (quoting Weaver
    v. Lancaster Newspapers, Inc., 
    926 A.2d 899
    , 902–03 (Pa.2007)).
    Zeager maintains that although this Court in the prior appeal found
    that he breached the Agreement, it did not address his affirmative defense
    that it was impossible for him to comply with the Agreement because
    Calabrese and Shirk provided insufficient notice of their desire to use his
    plant.     Appellant’s Brief at 14-15, 15 n.2.        Zeager maintains this Court
    “recognize[d] Calabrese and Shirk’s notice (or lack thereof) as an issue,” but
    “made no pronouncement as to whether Calabrese and Shirk did or did not
    provide sufficient notice to Zeager.”          Appellant’s Brief at 14-15.   Zeager
    argues the trial court erred when it failed to address the notice issue
    following remand from our May 22, 2009 decision. We find the law of the
    case doctrine prohibited the trial court from considering this issue.
    The law of the case doctrine “provides that if an appellate court has
    considered and decided a question on appeal, neither that court nor any trial
    court may revisit that question during another phase of the same case.”
    Gateway Towers Condominium Assoc. v. Krohn, 
    845 A.2d 855
    , 861
    (Pa.Super.2004).2      “The doctrine is designed to promote judicial economy,
    ____________________________________________
    2
    The distinct rules that make up the law of the case doctrine are:
    (1) upon remand for further proceedings, a trial court may
    not alter the resolution of a legal question previously
    decided by the appellate court in the matter; (2) upon a
    second appeal, an appellate court may not alter the
    (Footnote Continued Next Page)
    -7-
    J-A14022-15
    uniformity of decision making, protect the settled expectations of the
    parties, maintain the consistency of the litigation and end the case.”               
    Id. (quoting Peden
    v. Gambone Bros. Dev. Corp., 
    798 A.2d 305
    , 310
    (Pa.Cmwlth.2002)).
    The    Agreement         contained         the   following   provision   regarding
    government approvals:
    [2. Acceptance and Treatment of Sewage.]
    (c) At the Plant, [Zeager] shall treat [Calabrese and
    Shirk’s] Discharge in accordance with all federal, state,
    and local laws and regulations applicable thereto, and in
    accordance with standards established by the United
    States Environmental Protection Agency (‘EPA’), and the
    Pennsylvania Department of Environmental Resources
    (‘DER’), as such standards are from time to time
    promulgated, sufficient to permit discharge into the waters
    of the Commonwealth of Pennsylvania, and [Calabrese and
    Shirk]’s Discharge shall be so discharged.         Further,
    [Zeager] shall assure that all wastewater treated at the
    Plant is treated in accordance with all federal, state, and
    local laws and regulations applicable thereto, and in
    accordance with standards promulgated by the EPA and
    DER, sufficient to permit discharge into the waters of the
    Commonwealth of Pennsylvania. At all times and under
    all conditions, [Zeager] shall assure that the Plant
    has sufficient treatment capacity to treat (and shall
    _______________________
    (Footnote Continued)
    resolution of a legal question previously decided by the
    same appellate court; and (3) upon transfer of a matter
    between trial judges of coordinate jurisdiction, the
    transferee trial court may not alter the resolution of a legal
    question previously decided by the transferor trial court.
    In re Estate of Elkins, 
    32 A.3d 768
    , 776 (Pa.Super.2011) (quoting
    Commonwealth v. Starr, 
    664 A.2d 1326
    , 1331 (Pa.1995)).
    -8-
    J-A14022-15
    reserve sufficient treatment capacity), shall be
    capable of so treating, and shall be legally
    authorized to so treat [Calabrese and Shirk]’s
    Discharge.
    Sanitary Sewer Easement and Sewer Treatment Agreement, dated Nov. 26,
    1991, at p.3 (“Agreement”) (emphasis added).
    In the prior appeal, this Court found Zeager breached the Agreement.
    Calabrese v. Zeager, 
    976 A.2d 1151
    , 1151-52 (Pa.Super.2009). It further
    found:
    Both parties agree that the Agreement permitted
    Calabrese and Shirk to construct a pipe to connect with
    Zeager’s sewage plant and required Zeager to accept and
    treat the sewage.      The parties disagree, however,
    regarding which party bore the responsibility under the
    Agreement for obtaining the necessary government
    approvals to allow Calabrese and Shirk to connect their
    sewage pipe to Zeager’s plant (specifically, an “approved
    sewer module” from the Pennsylvania Department of
    Environmental Resources). The trial court decided that
    Calabrese and Shirk bore this responsibility and entered
    judgment in Zeager’s favor.
    We find that the highlighted portion of paragraph 2(c)
    unambiguously requires Zeager to have legal authorization
    in place to accept Calabrese and Shirk’s sewage discharge.
    The highlighted portion further makes clear that this
    obligation required Zeager to maintain this legal
    authorization “at all times and under all conditions,” and,
    therefore, when Calabrese and Shirk notified Zeager that
    they intended to connect a sewage pipe to Zeager’s plant,
    it was Zeager’s responsibility under paragraph 2(c) to
    obtain the required approvals from the DER. Paragraph
    2(c) plainly requires Zeager to treat the Calabrese and
    Shirk discharge in accordance with all federal, state, and
    local laws and regulations, and it would not be possible for
    Zeager to do so without obtaining the required “approved
    sewer module” from the DER.
    
    Id. at 1155-56.
    -9-
    J-A14022-15
    In the prior appeal, Zeager stated in his appellate brief:
    Zeager joins in the portion of the Statement of the Case
    related to the procedural history in this matter set forth on
    page 6 and through the first full paragraph on page 7 of
    the Calabrese Brief. It should also be noted that, at trial,
    evidence on additional issues was presented, the issues
    including:
    1. Did Calabrese give sufficiently timely notice to Zeager of
    his desire to connect the Calabrese property to the Zeager
    sewage plant?
    2. If Zeager was found to be in breach of the 1991
    Sanitary Sewer Easement and Sewage Treatment
    Agreement (the “Agreement”), what damages did
    Calabrese incur?
    3. Must any or all of Calabrese’s damages be offset by
    amounts Calabrese saved by not hooking up to the Zeager
    sewage plant?
    Because the [t]rial [c]ourt found Zeager did not breach the
    Agreement, the [t]rial [c]ourt did not need to address the
    above issues.
    Appellee Brief, filed 8/27/2007, at 2. Zeager further wrote:
    Alternatively, if this Court is persuaded that the [t]rial
    [c]ourt did commit some error in interpreting the
    Agreement, this Court must remand this matter to the
    [t]rial [c]ourt for such additional proceedings on the
    contract interpretation issue as this Court orders, as well
    as the issues raised before the [t]rial [c]ourt but not
    decided by the [t]rial [c]ourt as stated in the Procedural
    History (Part II. A.) of this Brief (timeliness of Calabrese
    notice, damages, and damages offset).
    
    Id. at 16.
       Zeager also discussed the evidence he believed established
    Calabrese and Shirk failed to provide notice, e.g., the permit process would
    take 6-12 months, Calabrese and Shirk did not write to Zeager until
    - 10 -
    J-A14022-15
    November 2003, and Calabrese and Shirk submitted plans for an onsite
    sewer maintenance system. 
    Id. at 4-6.
    Calabrese and Shirk’s appellate brief in the prior appeal discussed the
    evidence of the notice they provided in the course of arguing that Zeager
    breached the contract because he failed to obtain the legal authorization.
    Appellant’s Brief, filed July 26, 2007, at 24-25.
    This Court found Zeager breached the Agreement by failing to obtain
    the necessary permits after Calabrese and Shirk notified him they would use
    his sewer plant.    
    Calabrese, 976 A.2d at 1156
    .         Before reaching this
    decision, we reviewed the arguments relating to notice or lack thereof in the
    parties’ briefs.   Further, we conducted a plenary review of the record,
    including the trial transcripts, which contained testimony regarding the
    notice provided, and the Agreement, which provided that Zeager shall be
    legally authorized to treat Calabrese and Shirk’s discharge “[a]t all times and
    under all conditions.” Because we considered and decided the notice issue
    on the prior appeal, the law of the case doctrine precluded the trial court
    from revisiting this issue and Zeager’s claim lacks merit.
    Zeager also challenges the trial court’s damages calculation, arguing
    Calabrese and Shirk saved money when they used an on-site system rather
    than Zeager’s sewage treatment plant because they did not have to pay
    connection costs or maintenance and operation costs.         Appellant’s Brief at
    27. He further claims Calabrese and Shirk saved the costs they would have
    - 11 -
    J-A14022-15
    owed Zeager for the “re-construction” of Zeager’s sewer management
    system had they connected to the system. 
    Id. at 28.
    The Supreme Court of Pennsylvania has stated:
    Where one party to a contract without any legal
    justification, breaches the contract, the other party is
    entitled to recover, unless the contract provided otherwise,
    whatever damages he suffered, provided (1) they were
    such as would naturally and ordinarily result from the
    breach, or (2) they were reasonably foreseeable and within
    the contemplation of the parties at the time they made the
    contract, and (3) they can be proved with reasonable
    certainty.
    Helpin v. Trustees of Univ. of Pa., 
    10 A.3d 267
    , 270 (Pa.2010) (quoting
    Ferrer v. Trustees of the University of Pennsylvania, 
    825 A.2d 591
    ,
    610 (Pa.2002)). A damage award should “place the non-breaching party ‘as
    nearly as possible in the same position [it] would have occupied had there
    been no breach.’” 
    Id. (quoting Lambert
    v. Durallium Products Corp., 
    72 A.2d 66
    , 67 (Pa.1950)). “The measure of damages for breach of contract is
    compensation for the loss sustained. The aggrieved party can recover
    nothing more than will compensate him.” 
    Id. (quoting Lambert
    , 72 A.2d at
    67 (emphasis deleted)).
    Zeager claims the damages award should be offset by the amount
    Calabrese and Shirk saved by not connecting to Zeager’s plant, including the
    operation and maintenance costs (also referred to as sewage process
    charges) and the connection costs (also referred to as trenching costs).
    Appellant’s Brief at 29-31.
    - 12 -
    J-A14022-15
    Calabrese and Shirk are paying operational and maintenance costs
    associated with the sewage treatment facility they constructed when unable
    to access Zeager’s plant.           They did not include the operational and
    maintenance costs in the damages sought. Because Calabrese and Shirk are
    paying operational and maintenance costs, and such costs were not part of
    the damages award,3 the trial court properly declined to deduct these costs
    from the damages award.
    Zeager next claims the damages award should be offset by the
    connection costs Calabrese and Shirk would have spent had they connected
    to Zeager’s plant. We agree.
    The Agreement provided:
    [Calabrese and Shirk] shall be permitted to construct
    within the above-described easement sanitary sewer lines
    and other facilities to transport wastewater from
    [Calabrese and Shirk’s] Real Estate to the Plant, and
    [Zeager] shall connect such sewer lines to the Plant.
    Agreement at ¶ 2(a).            Further, at trial Calabrese testified that if he
    connected to Zeager’s plant, the Agreement required him to install the
    sewage line and he would bear the cost of such installation.               N.T.,
    9/19/2006, at 99.
    ____________________________________________
    3
    Operation and maintenance costs do not appear on the list of damages
    claimed. See Joint Trial Exhibit No. 53.
    - 13 -
    J-A14022-15
    Zeager’s breach of the Agreement forced Calabrese and Shirk to
    construct their own treatment facility.            By building their own treatment
    facility, however, they saved the costs they would have owed for connecting
    to Zeager’s sewage plant.          Therefore, to make them whole for Zeager’s
    breach, they are entitled to the cost they spent on their facility, less the
    connection costs they would have owed had they connected to Zeager’s
    plant.
    Calabrese and Shirk argue they still are entitled to connect to Zeager’s
    plant. Therefore, if the connection costs are deducted now, and Calabrese
    and Shirk later connect to Zeager’s plant, they would be paying those costs
    twice. Appellee’s Brief at 8. This argument, however, is speculative, as it is
    unclear whether Calabrese and Shirk will seek to connect to Zeager’s plant
    in the future.4      Moreover, whether Calabrese and Shirk will connect to
    Zeager’s plant is made even more speculative because Zeager replaced the
    original sewage treatment plant with a new sewage treatment facility at a
    new location. See Opinion, 12/15/2014, at 17, 16 n.10; Appellant’s Brief at
    28, 33-35.       Therefore, we find the court erred in not deducting the
    connection costs from the damages award. We leave it to the trial court to
    calculate the connection costs offset on remand.
    ____________________________________________
    4
    We need not address whether Calabrese and Shirk would be entitled to
    reimbursement of the connection costs offset in the event they later connect
    to Zeager’s plant.
    - 14 -
    J-A14022-15
    Zeager    also   maintains   Calabrese   and Shirk   are     liable   for   re-
    construction costs. We disagree.
    The Agreement provided:
    After connection of the sewer lines and other facilities
    installed to transport the [Calabrese’s and Shirk’s]
    discharge to the Plant, [Calabrese and Shirk] shall pay to
    [Zeager] a share of repair, reconstruction, and equipment
    replacement expenses incurred directly in connection with
    the operation of the plant and which are of a character
    that must be capitalized under generally accepted
    accounting standards (“Capital Improvements”), but such
    Capital Improvements shall not include improvements,
    additions and repairs initially made in order to
    accommodate and treat the [Calabrese’s and Shirk’s]
    Discharge or to increase the Sewer Plant’s capacity for
    treatment.
    Agreement, at 6.
    In 2008-2009, after trial, Zeager replaced his sewer treatment plant.
    He claims the amount Calabrese and Shirk allegedly would have owed had
    they been connected to Zeager’s plant ($78,000.00) should be offset against
    the damages award.      Appellant’s Brief at 28-29. This claim fails. Calabrese
    and Shirk never connected to the plant and, therefore, this provision, which
    applies only following connection to the plant, is inapplicable.
    Further, a new plant is not a “capital improvement.” As the trial court
    stated:
    [S]uch “capital improvements” do not encompass a brand
    new multi-million dollar sewer treatment facility at a
    completely new and separate site distinct from the location
    of Zeager’s original treatment plant. This was not a repair,
    reconstruction, or restoration of the old facility as
    envisioned    by    the   Agreement.    Zeager’s    counsel
    - 15 -
    J-A14022-15
    acknowledged at the trial in this matter that Zeager was
    “building a new plant” that was separate and distinct from
    the “old plant.” It is disingenuous and incongruous of
    Zeager to continually refer to the “reconstruction” of a
    “new sewage treatment plant.”
    Trial Court Opinion, 12/15/14, at 17 (internal citations omitted).
    Moreover, even if it were a “capital improvement,” Calabrese and Shirk
    would not have been responsible for the cost. Pursuant to the agreement,
    Calabrese and Shirk are not responsible for capital improvements that
    increase the capacity of the plant.       Agreement at ¶ 4(d).   Applying this
    provision, the trial court reasoned:
    Zeager’s expert engineer, McCorkle, testified that the new
    plant was necessary for the growth of Zeager’s business,
    Hershey Farms, and Sight & Sound Theater, another
    adjoining property which also contracted for the use of the
    sewage treatment facility. Post[-]trial discovery further
    revealed that Zeager had granted the right to access and
    utilize the new plant to Keystone Custom Homes for an
    entirely new residential development. The new plant more
    than tripled the capacity of the original plant from 35,000
    gallons per day of discharge to 110,000 gallons of sewage
    per day. Clearly, the new plant was constructed for the
    purpose of significantly increasing the amount of treatment
    capacity that Zeager controlled.         Thus, pursuant to
    subparagraph 4(d) of the Agreement, Calabrese [and Shirk
    are] not obligated to contribute to the costs of such
    “improvements, additions and repairs” to increase the
    plant’s capacity.
    Opinion, 12/15/14, at 17-18.
    - 16 -
    J-A14022-15
    Order affirmed in part and reversed in part.    Remanded for the trial
    court to offset damages in the amount of costs Calabrese and Zeager would
    have paid to connect to Zeager’s plant. Jurisdiction relinquished.
    Judgment Entered.
    Joseph D. Seletyn, Esq.
    Prothonotary
    Date: 6/1/2015
    - 17 -