Chen v. Chen

893 A.2d 87, 586 Pa. 297, 2006 Pa. LEXIS 253
CourtSupreme Court of Pennsylvania
DecidedMarch 20, 2006
Docket89 MAP 2004
StatusPublished
Cited by30 cases

This text of 893 A.2d 87 (Chen v. Chen) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chen v. Chen, 893 A.2d 87, 586 Pa. 297, 2006 Pa. LEXIS 253 (Pa. 2006).

Opinions

OPINION

Justice BAER.

We granted allowance of appeal to address a question of first impression before this Court concerning whether a child may bring suit or intervene in an action to enforce provisions of her parents’ property settlement agreement. The Superior Court and the trial court below held that the child in this case could intervene in her mother’s support action because the child was a third party intended beneficiary under her parents’ property settlement agreement pursuant to the Restatement (Second) of Contracts § 302, as adopted by this Court in Guy v. Liederbach, 501 Pa. 47, 459 A.2d 744 (1983). For the reasons that follow, we reverse.

[299]*299Wheamei Chen (“Mother”) and Richard Chen (“Father”) were married on August 9, 1977. During the course of their six-year marriage, they had two children, Robert (Son), born in 1978, and Theresa (Daughter), born in 1982. At the time of the divorce in 1983, the parties entered into a property settlement agreement (the “Agreement”). The Agreement provided that Mother would have physical and legal custody of Daughter and that Father would have physical and legal custody of Son. The Agreement also contained the following provision:

9. Child Support
[Father] agrees and contracts to pay to [Mother] the sum of $25.00 per week as child support of the child, [Daughter] who will be in the custody of [Mother], [Father] further agrees that upon obtaining regular employment or upon any increase in salary the aforementioned support award will be increased in accordance with the Northampton County Domestic Relations Guidelines. [Father] hereby waives, releases and renounces any and all claims to child support for [Son],

The Agreement was incorporated by reference but not merged into the divorce decree.

The parties do not contest that Father paid to Mother $25.00 weekly until Daughter’s eighteenth birthday. Although Father obtained employment and increases in salary beginning in 1985, he never increased the amount of child support in accordance with the Domestic Relations Section Guidelines as specified in the Agreement. Furthermore, at no time did Mother seek an increase in the support amount.1

When Daughter turned eighteen in February 2000, the Domestic Relations Section of the Northampton County Court [300]*300of Common Pleas notified Mother that support would be terminated. On April 27, 2000, Mother filed a petition for special relief in the Northampton County Court of Common Pleas requesting enforcement of the property settlement agreement and a finding of contempt of court. Mother sought to enforce the Agreement’s provision for increases in child support and to collect “total support/arrearages” based upon Husband’s salary increases over the almost eighteen years the agreement had been in effect and Father had been paying $25.00 per week. Petition for Special Relief, April 27, 2000, at 3.

On May 25, 2000, shortly after turning eighteen, Daughter filed a petition to intervene as a party to her mother’s action.She asserted that intervention under Pa.R.C.P. 2327(4)2 was appropriate because she had a “legally enforceable interest” as a third party intended beneficiary under the Agreement. Daughter relied upon this Court’s adoption in Guy of the Restatement (Second) of Contracts § 302 (Section 302),3 which expanded our prior rule that restricted an intended beneficiary’s standing to recover under a contract to those contracts [301]*301manifesting an express intention by the contracting parties to benefit the third party. See Spires v. Hanover Fire Insurance Co., 364 Pa. 52, 70 A.2d 828 (1950). She contended that she satisfied the more liberal Section 302, which provides, in pertinent part, that “a beneficiary of a promise is an intended beneficiary if recognition of a right to performance in the beneficiary is appropriate to effectuate the intentions of the parties” and “circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.” Restatement (Second) of Contracts § 302(l)(b).‘4

On November 27, 2000, after conducting a hearing, the trial court found that the Daughter was an intended beneficiary to the Agreement and granted her petition to intervene. The court concluded that Daughter satisfied the Guy test because “recognition of [Daughter] as [an intended] beneficiary5 to paragraph nine [of the Agreement] is appropriate to achieve what appears to be the parties’ clear intention that the child support provision was to benefit [Daughter] throughout her minority.” Tr. Ct. Order, Nov. 27, 2000, at 6.

After the trial court granted Daughter’s intervention petition, Mother withdrew as party-petitioner, leaving Daughter and Father as party-opponents. A non-jury trial was held on January 28, 2002 on the merits of what was then Daughter’s petition to enforce the Agreement. On June 28, 2002, the [302]*302trial court entered an order in favor of Daughter and against Father. As the Agreement had been incorporated but not merged into the divorce decree, the trial court interpreted the document as an independent contract rather than a court order.6 As addressed in the November 2000 order, the court reiterated its conclusion that Daughter satisfied the requirements of Section 302 as adopted in Guy. The court then concluded that the language of paragraph nine required Father affirmatively to increase his support payments after obtaining employment and raises, rather than waiting for Mother to request increases. Accordingly, the court found that Father .had breached the Agreement.7 The court calculated the amount of support allegedly due Mother from Father under the Domestic Relations Section Guidelines, subtracted the amount that had been paid by Father, and determined that Father owed $59,292.80.8

[303]*303Father timely filed a notice of appeal with the Superior Court and complied with the trial court’s order to file a statement of matters complained of on appeal pursuant to Pa.R.A.P.1925(b). Husband challenged the trial court’s decision to allow Daughter to intervene as an intended beneficiary.

In a published decision affirming the trial court,9 the Superi- or Court observed that the specific question of whether a child can sue to enforce a support provision for her benefit based on her parents’ property settlement agreement was an issue of first impression in the Commonwealth. Chen v. Chen, 840 A.2d 355, 359 (Pa.Super.2003). To determine whether Daughter could enforce the provision as an intended beneficiary, the court applied the two-part test set forth in Guy:

(1) the recognition of the beneficiary’s right must be “appropriate to effectuate the intention of the parties,” and (2) the performance must “satisfy an obligation of the promisee to pay money to the beneficiary” or “the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.”

Guy, 459 A.2d at 751.

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Bluebook (online)
893 A.2d 87, 586 Pa. 297, 2006 Pa. LEXIS 253, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chen-v-chen-pa-2006.