J. A32009/16
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
BLUE HAVEN POOLS, : IN THE SUPERIOR COURT OF : PENNSYLVANIA Appellant : : v. : : SKIPPACK BUILDING CORPORATION, : AND BS TRUST, EB TRUST, JE TRUST : AND SJ TRUST, GARNISHEES : : : No. 1226 EDA 2015
Appeal from the Order Entered March 23, 2015 In the Court of Common Pleas of Montgomery County Civil Division at No(s): 05-26165
BEFORE: DUBOW, RANSOM, AND PLATT,* JJ.
MEMORANDUM BY DUBOW, J.: FILED APRIL 03, 2017
Appellant, Blue Haven Pools, appeals from the March 23, 2015 Order
denying its Post-Trial Motion.1 After careful review, we affirm on the basis of
the trial court’s well-reasoned Opinion.
* Retired Senior Judge Assigned to the Superior Court. 1 The trial court’s docket reflects that on January 23, 2017, Judgment was entered against Appellant and in favor of Appellees. Because the trial court’s March 23, 2015 Order denying Appellant’s Post-trial Motion was later reduced to Judgment, and was the court’s final pronouncement on the matter, it is properly appealable. See Johnston the Florist, Inc. v. TEDCO Constr. Corp., 657 A.2d 511, 513 (Pa. Super. 1995) (en banc) (holding that, although the appeal was taken from an order denying post- trial relief, “jurisdiction in appellate courts may be perfected after an appeal notice has been filed upon the docketing of a final judgment.”). J. A32009/16
The trial court’s Pa.R.A.P. 1925(a) Opinion includes a thorough and
complete narrative of the lengthy factual and procedural history of this case,
which we adopt for purposes of this appeal. See Trial Court Opinion, dated
7/15/16, at 2-11. While we will not go into exhaustive detail here, some of
the relevant facts are as follows.
On November 1, 2005, Appellant filed a civil action for breach of
contract against Appellee Skippack Building Corporation (“Skippack”), citing
Skippack’s failure to make payments due on a construction contract. During
the pendency of the civil action, Skippack distributed nearly half a million
dollars in funds to its shareholders (BS Trust, EB Trust, JE Trust, and SJ
Trust, or “Garnishees”), leaving Skippack with only $375 in assets. A
portion of the funds transferred were initially classified as “loans to
shareholders” in Skippack’s 2008 and 2009 tax returns, but by 2010,
Skippack had reclassified the loans as distributions in tax filings.
On November 1, 2010, Appellant received a Judgment in its favor
against Appellee Skippack in the amount of $74,131.73, which was later
reassessed at $94,754.10. Since that date, Appellant has been involved in
extensive litigation trying to enforce the Judgment through garnishment
proceedings and, eventually, an attempt to void the transfer to Garnishees
as fraudulent. At issue in the instant appeal is the procedural posture by
which Appellant attempted to void the fraudulent transfer, as well as the
characterization of the transfers as a distribution rather than a loan.
-2- J. A32009/16
Specifically, Appellant raises five issues on appeal:
1. Whether the trial [c]ourt committed an abuse of discretion or error of law in failing to enter judgment against Garnishees, BS Trust, EB Trust, JE Trust[,] and SJ Trust (the Trusts), jointly and severally, in the amount of $94,754.10.
[2.] Whether the trial [c]ourt committed an abuse of discretion or error of law in failing to find that Skippack Building Corporation’s “Loans to shareholders” (that is, loans to each of the Trusts) in the amount of $231,573.00 were subject to execution, when [Skippack] and the Trusts admitted, and when the unrefuted and uncontradicted [sic] evidence was, that they were “assets” and “receivables” of the corporation, and were never repaid.
[3.] Whether the trial [c]ourt committed an abuse of discretion or error of law in finding that it was without the authority to determine or adjudicate conflicting rights to property in the possession of third parties, including alleged fraudulent transfers, when the [c]ourt was duly authorized, and subsequently conducted, “an independent full dress,” “plenary” trial on the merits.
[4.] Whether the trial [c]ourt committed an abuse of discretion or error of law in finding that the distributions of cash made by Skippack Building Corporation to shareholders (that is, distributions to each of the Trusts), in the aggregate amount of $464,568.00, were fraudulent conveyances, when the unrefuted and uncontradicted [sic] evidence was that they effectively stripped the corporation of any assets.
5. Whether the trial [c]ourt committed an abuse of discretion or error of law in failing to find that the elimination or writing off of “Loans to shareholders” (that is, loans to each of the Trusts), by “distributing” them to shareholders, as if no money were owed, were fraudulent conveyances.
Appellant’s Brief at 4 (reordered for ease of disposition).
This Court’s scope and standard of review on appeal following a bench
trial is well-settled:
-3- J. A32009/16
Our appellate role in cases arising from non-jury trial verdicts is to determine whether the findings of the trial court are supported by competent evidence and whether the trial court committed error in any application of the law. The findings of fact of the trial judge must be given the same weight and effect on appeal as the verdict of a jury. We consider the evidence in a light most favorable to the verdict winner. We will reverse the trial court only if its findings of fact are not supported by competent evidence in the record or if its findings are premised on an error of law. However, where the issue . . . concerns a question of law, our scope of review is plenary.
The trial court's conclusions of law on appeal originating from a non-jury trial are not binding on an appellate court because it is the appellate court's duty to determine if the trial court correctly applied the law to the facts of the case.
Stephan v. Waldron Elec. Heating and Cooling LLC, 100 A.3d 660, 664-
65 (Pa. Super. 2014) (citation and quotation omitted). The trial court, as
the finder of fact, is free to believe “all, part[,] or none of the evidence
presented.” Ruthrauff, Inc. v. Ravin, Inc., 914 A.2d 880, 888 (Pa. Super.
2006). “Issues of credibility and conflicts in evidence are for the trial court
to resolve; this Court is not permitted to reexamine the weight and
credibility determinations or substitute our judgment for that of the
factfinder.” Id. (citation and internal quotation marks omitted).
As a preliminary matter, although Appellant lists five issues in his
Statement of Questions Involved, they are better understood as two issues.
In fact, the argument portion of Appellant’s Brief is broken into only two
sections, and the trial court addressed Appellant’s five issues as only two
distinct arguments. Similarly, we will combine Appellant’s issues into the
two underlying arguments.
-4- J. A32009/16
First, Appellant argues that the trial court erred in finding that the
Trusts lacked any assets of Skippack subject to execution, averring that at
least a portion of the distributions made to Garnishees was in fact a loan.
Appellant’s Brief at 26-36. The Honorable Thomas P. Rogers has authored a
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J. A32009/16
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
BLUE HAVEN POOLS, : IN THE SUPERIOR COURT OF : PENNSYLVANIA Appellant : : v. : : SKIPPACK BUILDING CORPORATION, : AND BS TRUST, EB TRUST, JE TRUST : AND SJ TRUST, GARNISHEES : : : No. 1226 EDA 2015
Appeal from the Order Entered March 23, 2015 In the Court of Common Pleas of Montgomery County Civil Division at No(s): 05-26165
BEFORE: DUBOW, RANSOM, AND PLATT,* JJ.
MEMORANDUM BY DUBOW, J.: FILED APRIL 03, 2017
Appellant, Blue Haven Pools, appeals from the March 23, 2015 Order
denying its Post-Trial Motion.1 After careful review, we affirm on the basis of
the trial court’s well-reasoned Opinion.
* Retired Senior Judge Assigned to the Superior Court. 1 The trial court’s docket reflects that on January 23, 2017, Judgment was entered against Appellant and in favor of Appellees. Because the trial court’s March 23, 2015 Order denying Appellant’s Post-trial Motion was later reduced to Judgment, and was the court’s final pronouncement on the matter, it is properly appealable. See Johnston the Florist, Inc. v. TEDCO Constr. Corp., 657 A.2d 511, 513 (Pa. Super. 1995) (en banc) (holding that, although the appeal was taken from an order denying post- trial relief, “jurisdiction in appellate courts may be perfected after an appeal notice has been filed upon the docketing of a final judgment.”). J. A32009/16
The trial court’s Pa.R.A.P. 1925(a) Opinion includes a thorough and
complete narrative of the lengthy factual and procedural history of this case,
which we adopt for purposes of this appeal. See Trial Court Opinion, dated
7/15/16, at 2-11. While we will not go into exhaustive detail here, some of
the relevant facts are as follows.
On November 1, 2005, Appellant filed a civil action for breach of
contract against Appellee Skippack Building Corporation (“Skippack”), citing
Skippack’s failure to make payments due on a construction contract. During
the pendency of the civil action, Skippack distributed nearly half a million
dollars in funds to its shareholders (BS Trust, EB Trust, JE Trust, and SJ
Trust, or “Garnishees”), leaving Skippack with only $375 in assets. A
portion of the funds transferred were initially classified as “loans to
shareholders” in Skippack’s 2008 and 2009 tax returns, but by 2010,
Skippack had reclassified the loans as distributions in tax filings.
On November 1, 2010, Appellant received a Judgment in its favor
against Appellee Skippack in the amount of $74,131.73, which was later
reassessed at $94,754.10. Since that date, Appellant has been involved in
extensive litigation trying to enforce the Judgment through garnishment
proceedings and, eventually, an attempt to void the transfer to Garnishees
as fraudulent. At issue in the instant appeal is the procedural posture by
which Appellant attempted to void the fraudulent transfer, as well as the
characterization of the transfers as a distribution rather than a loan.
-2- J. A32009/16
Specifically, Appellant raises five issues on appeal:
1. Whether the trial [c]ourt committed an abuse of discretion or error of law in failing to enter judgment against Garnishees, BS Trust, EB Trust, JE Trust[,] and SJ Trust (the Trusts), jointly and severally, in the amount of $94,754.10.
[2.] Whether the trial [c]ourt committed an abuse of discretion or error of law in failing to find that Skippack Building Corporation’s “Loans to shareholders” (that is, loans to each of the Trusts) in the amount of $231,573.00 were subject to execution, when [Skippack] and the Trusts admitted, and when the unrefuted and uncontradicted [sic] evidence was, that they were “assets” and “receivables” of the corporation, and were never repaid.
[3.] Whether the trial [c]ourt committed an abuse of discretion or error of law in finding that it was without the authority to determine or adjudicate conflicting rights to property in the possession of third parties, including alleged fraudulent transfers, when the [c]ourt was duly authorized, and subsequently conducted, “an independent full dress,” “plenary” trial on the merits.
[4.] Whether the trial [c]ourt committed an abuse of discretion or error of law in finding that the distributions of cash made by Skippack Building Corporation to shareholders (that is, distributions to each of the Trusts), in the aggregate amount of $464,568.00, were fraudulent conveyances, when the unrefuted and uncontradicted [sic] evidence was that they effectively stripped the corporation of any assets.
5. Whether the trial [c]ourt committed an abuse of discretion or error of law in failing to find that the elimination or writing off of “Loans to shareholders” (that is, loans to each of the Trusts), by “distributing” them to shareholders, as if no money were owed, were fraudulent conveyances.
Appellant’s Brief at 4 (reordered for ease of disposition).
This Court’s scope and standard of review on appeal following a bench
trial is well-settled:
-3- J. A32009/16
Our appellate role in cases arising from non-jury trial verdicts is to determine whether the findings of the trial court are supported by competent evidence and whether the trial court committed error in any application of the law. The findings of fact of the trial judge must be given the same weight and effect on appeal as the verdict of a jury. We consider the evidence in a light most favorable to the verdict winner. We will reverse the trial court only if its findings of fact are not supported by competent evidence in the record or if its findings are premised on an error of law. However, where the issue . . . concerns a question of law, our scope of review is plenary.
The trial court's conclusions of law on appeal originating from a non-jury trial are not binding on an appellate court because it is the appellate court's duty to determine if the trial court correctly applied the law to the facts of the case.
Stephan v. Waldron Elec. Heating and Cooling LLC, 100 A.3d 660, 664-
65 (Pa. Super. 2014) (citation and quotation omitted). The trial court, as
the finder of fact, is free to believe “all, part[,] or none of the evidence
presented.” Ruthrauff, Inc. v. Ravin, Inc., 914 A.2d 880, 888 (Pa. Super.
2006). “Issues of credibility and conflicts in evidence are for the trial court
to resolve; this Court is not permitted to reexamine the weight and
credibility determinations or substitute our judgment for that of the
factfinder.” Id. (citation and internal quotation marks omitted).
As a preliminary matter, although Appellant lists five issues in his
Statement of Questions Involved, they are better understood as two issues.
In fact, the argument portion of Appellant’s Brief is broken into only two
sections, and the trial court addressed Appellant’s five issues as only two
distinct arguments. Similarly, we will combine Appellant’s issues into the
two underlying arguments.
-4- J. A32009/16
First, Appellant argues that the trial court erred in finding that the
Trusts lacked any assets of Skippack subject to execution, averring that at
least a portion of the distributions made to Garnishees was in fact a loan.
Appellant’s Brief at 26-36. The Honorable Thomas P. Rogers has authored a
comprehensive, thorough, and well-reasoned Opinion, citing to the record
and relevant case law in addressing Appellant’s claim. After a careful review
of the parties’ arguments and the record, we affirm on the basis of that
Opinion, which found that “Garnishees owed no money to and possessed no
property of [Appellee] Skippack subject to execution when the Montgomery
County Sheriff’s Department served the writs of execution on August 19,
2011, or thereafter.” Trial Court Opinion at 13-17.
Second, Appellant avers that Appellee Skippack’s distributions to
Garnishees were fraudulent transfers, and that the trial court erred in
concluding that it was precluded from adjudicating the merits of a fraudulent
transfer claim in a garnishment proceeding brought pursuant to Pa.R.C.P.
No. 3118. Appellant’s Brief at 36-47. Judge Rogers’ Opinion includes a
comprehensive, thorough, and well-reasoned discussion of this claim, with
citations to the record and relevant case law. After a careful review of the
parties’ arguments, and the record, we affirm on the basis of that Opinion,
which recognized binding precedent from our Supreme Court holding that,
absent a waiver by the parties, a trial court may not properly adjudicate a
fraudulent transfer claim in a garnishment proceeding, and a plaintiff must
-5- J. A32009/16
instead bring a separate action in equity. Trial Court Opinion at 17-25
(citing, inter alia, Greater Val. Terminal Corp. v. Goodman, 202 A.2d 89
(1964)). In the instant case, Appellee Skippack and Garnishees did not
waive their objection to the trial court adjudicating the fraudulent transfer
claim; accordingly, the trial court properly concluded that it was without
authority to hear the matter.
Our analysis, and that of the trial court’s well-written Opinion, is
unaffected by this Court’s recent holding in Knoll v. Uku, __ A.3d __, 2017
PA Super 6 (filed January 12, 2017). In Knoll, this Court reviewed the
merits of a fraudulent transfer claim that was brought pursuant to Pa.R.C.P.
No. 3118. There, the parties did not object to the trial court hearing the
fraudulent transfer claim within a Rule 3118 proceeding, and on appeal,
neither party asked this Court to consider whether a fraudulent transfer
claim may properly be brought in a Rule 3118 proceeding over the
objections of the garnishees.
The instant case, however, is distinguishable from Knoll. Appellee
Skippack and Garnishees did, in fact, object to the trial court adjudicating
the fraudulent transfer claim in a Rule 3118 proceeding. As discussed
supra, our review confirms that the trial court properly concluded that it
was without authority to hear the matter.2
2 At oral argument, Appellant raised a third theory of relief, arguing that the fraudulent transfer claim was raised under Pa.R.C.P. No. 3147, and not
-6- J. A32009/16
The parties are directed to attach a copy of the trial court’s July 15,
2016 Opinion to all future filings.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq. Prothonotary
Date: 4/3/2017
pursuant to Pa.R.C.P. No. 3118. Appellant has waived this argument by failing to develop it in its Brief to this Court. See Commonwealth v. Hardy, 918 A.2d 766, 771 (Pa. Super. 2007). Moreover, Rule 3147 applies after a court has entered judgment for a plaintiff against a garnishee upon pleadings or after trial; nothing in Rule 3147 authorizes a plaintiff to file pleadings or request a trial. See Pa.R.C.P. No. 3147 (“If the court enters judgment for the plaintiff and against the garnishee upon pleadings or after trial, the judgment shall be for the property of the defendant found to be in the garnishee's possession, but no money judgment entered against the garnishee shall exceed the amount of the judgment of the plaintiff against the defendant together with interest and costs.”)
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