Kessock v. Conestoga Title Ins. Co.

194 A.3d 1046

John KESSOCK, Jr.

v.CONESTOGA TITLE INSURANCE CO.

v.Delancey Abstract Corp., Joseph Hopkins, Law Offices of Hopkins and Schafkopf, LLC, Security Search and Abstract Co., Inc.

Appeal of: Joseph Hopkins and Delancey Abstract Corp.

No. 3737 EDA 2017

Superior Court of Pennsylvania.

Submitted May 14, 2018

Filed August 09, 2018

Joseph D. DiGuglielmo, Elverson, and Jeffrey D. Servin, Philadelphia, for appellants.

Mark C. Clemm, Blue Bell, for Conestoga, appellee.

Matthew B. Weisberg, Morton, for Kessock, appellee.

Gary Schafkopf, Bala Cynwyd, for Law Office of Hopkins and Schafkopf, appellee.

Michael J. Revness, Wayne, for Security Search and Abstract, appellee.

BEFORE: SHOGAN, J., LAZARUS, J., and DUBOW, J.

OPINION BY SHOGAN, J.:

Joseph Hopkins ("Hopkins") and Delancey Abstract Corporation ("Delancey") (collectively, "Appellants") appeal the judgment entered against them.¹ We affirm.

The trial court entered the following findings of fact:

1. This lawsuit arises from a dispute concerning real property purchased by Plaintiff [John Kessock, Jr.] on or about April 18, 2005, with a physical address of 1333 Beaumont Drive, Gladwyne, PA 19035 (hereinafter, the "Subject Property").

2. Defendant Conestoga was the title insurance underwriter for the Subject Property.

3. Plaintiff's claim stems from a breach of Conestoga's obligations to disclose an easement, as part of its title agency services, when Plaintiff purchased the Subject Property.

4. The recorded easement was discovered by Plaintiff after the completion of the sale of the Subject Property.

5. Thereafter, Plaintiff made a title insurance claim with Conestoga, alleging his claim was worth in excess of $1,000,000. Conestoga denied the insurance claim.

6. Additional Defendant Delancey, a now non-operating Pennsylvania corporate entity, was a title insurance broker.

7. Delancey was the title agent who conducted the closing for the Subject Property.

8. Additional Defendant Hopkins was the principal of Delancey.

9. Security Search and Abstract Company, Inc. ("Security Abstract") was the agent hired by Delancey to actually conduct the title search for the Subject Property.

10. Additional Defendant Hopkins and Schafkopf is a law firm which provided no services related to this case even though Hopkins' name appears in the firm's name.

11. On April 21, 2004, Conestoga entered into an agency agreement with Delancey (the "Agency Agreement").

12. Paragraph 5 of the Agency Agreement provides:

Agent agrees to be solely liable and indemnify Conestoga for all attorneys' fees, court costs, expenses and loss or aggregate of losses resulting from shortages in its escrow accounts, fraud, negligence or misconduct of its agents, its officers, or employees in the issuance of title insurance. Agent agrees that Conestoga shall have full control of the determination, procedure and final decision of all losses including the defense thereof. Conestoga agrees to consult with Agent prior to making any final decision on losses on policies issued by Agent.

13. The Agency Agreement was executed under seal by Hopkins on behalf of Delancey.

14. Also on April 21, 2004, Hopkins executed a "Guaranty of Payment and Performance" in which Hopkins personally guaranteed Delancey's performance of the Agency Agreement, including "indemnifications and claims of loss as set forth in the Agency Agreement (the "Guaranty").

15. The Guaranty was not executed under seal by Hopkins.

Decision with Findings of Fact and Conclusions of Law, 8/17/17, at 2–3.

The trial court summarized the procedural history of this case as follows:

On December 16, 2008 Plaintiff John Kessock, Jr. ("Plaintiff") commenced this action by filing a Complaint against Conestoga Title Insurance Co. ("Conestoga") and Security Abstract. On June 12, 2009, an Amended Complaint was filed. Pursuant to an Order dated January 19, 2010, Security Abstract's Preliminary Objections were sustained, and it was dismissed as a party. Conestoga filed a motion to join Delancey, Hopkins, and the Law Offices of Hopkins & Schafkopf, LLC ("Hopkins & Schafkopf") as additional defendants on May 19, 2011. That motion was granted on June 5, 2012, entered of record on June 6, 2012.

On November 9, 2016, a two-day non-jury trial on liability was conducted. In an Order dated November 18, 2016, upon consideration of the evidence presented, and after granting Plaintiff's Motion for Partial Directed Verdict, this [c]ourt ultimately found in favor of Conestoga and against Plaintiff. Further, on the crossclaims asserted by Conestoga against Appellants and Hopkins & Schafkopf, the [c]ourt found in favor of Conestoga and against Delancey and Hopkins only on its claim for attorney's fees and costs. A compulsory nonsuit/directed verdict was granted to Hopkins & Schafkopf.

An additional two-day non-jury trial on damages was conducted beginning on May 1, 2017 on the singular issue of the assessment of attorney's fees. On August 17, 2017 this [c]ourt issued its decision with seventeen pages of findings of fact and conclusions of law. On October 12, 2017, this [c]ourt denied Appellant[s'] motion for post-trial relief.

On October 17, 2017 Appellants filed a Notice of Appeal to this [c]ourt's October 12, 2017 Order denying Appellant[s'] motion for post-trial relief.^[2] On November 6, 2017, pursuant to Pennsylvania Rule of Appellate Procedure 1925(b), this [c]ourt Ordered Appellants to file a concise statement of errors complained of on appeal within 21 days.

Appellants filed their Concise Statement of Matters Complained of on Appeal on November 27, 2017. In their Concise Statement, Appellants claim, in more specific detail, that the trial court erred in: (1) allowing the joinder of [A]ppellants, (2) not finding in favor of Appellants, and (3) the [c]ourt's calculation of attorney's fees.

Trial Court Opinion, 12/1/17, at 1–2.

On appeal, Appellants present the following questions for our review:

A. Appellee Conestoga Title Insurance Company filed two successive motions to join Appellants Joseph Hopkins and Delancey Abstract Corporation as additional defendants, filed 431 days and 1,270 days after the joinder period of Pa.R.C.P. No. 2253 expired. And Conestoga's attorneys falsely represented to the Trial Court in both motions that they had just discovered Hopkins' and Delancey's potential liability. Did the Trial Court abuse its discretion in granting the joinder motions?

B. Appellant Joseph Hopkins gave a contract-based personal guaranty that Delancey Abstract Corporation would perform its Agency Agreement with Conestoga and would indemnify Conestoga for attorneys' fees if Delancey was negligent in issuing title insurance on Conestoga's behalf. Conestoga did not file its complaint against Hopkins alleging breach of the guaranty until five years after it learned of its contractual claim against Hopkins[.] Did the Trial Court err in concluding that Conestoga's claims against Hopkins were not barred by the statute of limitations?

C. Did the Trial Court err in refusing to reduce the attorneys' fees chargeable to Hopkins and Delancey as unreasonable for any or all of the following reasons:

a. Conestoga litigated for eight years without ever ascertaining the amount of money in dispute;

b. Conestoga denied liability and the existence of a contractual relationship between Plaintiff John Kessock and Conestoga for eight years of litigation, only to admit contractual liability at trial;

c. The time entries of the attorneys admitted into evidence were recorded recollections requiring the testimony of the declarant at trial, but two of the three attorneys did not testify at trial;

d. Delancey did not agree to indemnify Conestoga for attorneys' fees related to enforcing the Agency Agreement, yet the judgment requires Hopkins and Delancey to indemnify Conestoga for those charges; and

e. Attorney Mark Clemm charged $175 per hour for his daughter's time before she was admitted to practice law in Pennsylvania, which is the same rate charged after her admission to practice?

Appellants' Brief at 3–4.

Appellants first complain that the trial court abused its discretion by granting Conestoga's untimely motions to join Appellants as additional defendants. Appellants' Brief at 14. We have explained the joinder procedure as follows:

The Pennsylvania Rules of Civil Procedure provide that a writ for joinder shall be filed by the original defendant or an additional defendant no later than sixty (60) days after effecting service upon the original defendant of the initial pleading of the plaintiff or any amendment thereof "unless such filing is allowed by the court upon cause shown." Pa.R.C.P. 2253, Time for Filing Praecipe or Complaint . Whether there is sufficient cause to allow late joinder of an additional defendant is a matter within the sound discretion of the trial court.

Mutual Industries, Inc. v. Weinberg , 423 Pa.Super. 328, 621 A.2d 140, 143 (1993). Nevertheless, the court "should be guided by the objectives sought to be achieved by use of the additional defendant procedure." Zakian v. Liljestrand , 438 Pa. 249, 256, 264 A.2d 638, 641 (1970). Joinder should be granted when it can "simplify and expedite the disposition of matters involving numerous parties without subjecting the original plaintiff to unreasonable delay in the prosecution of his portion of the litigation." Id. (citations omitted).

When requesting the belated joinder of an additional defendant, a party must show (1) that joinder is based on proper grounds, (2) that some reasonable excuse exists for the delay in commencing joinder proceedings, and (3) that the original plaintiff will not be prejudiced by the late joinder. Francisco v. Ford Motor Co. , 406 Pa.Super. 144, 593 A.2d 1277, 1278 (1991). This Court has also considered the potential for prejudice to the proposed additional defendant. Prime Properties Development Corp. v. Binns , 397 Pa.Super. 492, 580 A.2d 405 (1990). However, limitations on joinder are primarily intended to protect a plaintiff from being unduly delayed

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