Knapp v. Murphy

30 Pa. D. & C.4th 136
CourtPennsylvania Court of Common Pleas, Tioga County
DecidedJanuary 4, 1996
Docketno. 261 Civil 1993
StatusPublished

This text of 30 Pa. D. & C.4th 136 (Knapp v. Murphy) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Tioga County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Knapp v. Murphy, 30 Pa. D. & C.4th 136 (Pa. Super. Ct. 1996).

Opinion

SMITH, P.J.,

— Plaintiffs have sued defendant, an attorney, raising a claim arising from defendant’s prior representation of them. The matter comes now before the court on cross-motions for summary judgment. Defendant’s motion asks the court to dismiss plaintiffs’ claim, as it was brought more than two years after the allegedly negligent activities of defendant and, further, because plaintiffs had voluntarily entered into a settlement agreement. Plaintiffs, in their motion for summary judgment, argue that defendant, over a period of six months, engaged in a course of deception or misfeasance causing the loss of their property. Plaintiffs admit signing a comprehensive settlement agreement relating to the matters on which defendant represented them, but argue that they were not aware that they had been negligently represented until December 2, 1991, when the opposing parties in the prior action obtained a summary judgment against them. Accordingly, plaintiffs argue that the date of the summary judgment, December 2, 1991, effectively begins the period for testing the statute of limitations. Although they are not explicit as to which statute of limitations applies, plaintiffs take the position that their action against defendant, having commenced April 21, 1993, was timely. Plaintiffs also argue that the fact that they voluntarily entered into a settlement agreement does not necessarily prohibit an action by them against their attorney for legal malpractice.

Defendant was retained by plaintiffs in April of 1988 on the recommendation of plaintiffs’ prior attorney, who had represented plaintiffs in 1985 with regard to the sale of their business, a motorcycle dealership. The pertinent details of the sale were succinctly recounted by the Superior Court of Pennsylvania when it affirmed the decision of the Court of Common Pleas of Tioga [138]*138County, holding that plaintiffs failed to offer sufficient facts to support their allegation of fraudulent inducement. The Superior Court found the following facts:

“In 1985, [plaintiffs], husband and wife, sold a business known as ‘Larry’s Sport’s Center’ to William and Carol Lockhart for the sum of $400,000. Half of the purchase price, i.e. $200,000, was advanced by Jersey Shore State Bank. As security for the loan, the bank took a mortgage on business real estate and a security interest in personalty. The remaining half of the purchase price was advanced by plaintiffs, who received, as security, a second mortgage on the real estate and a security interest in the inventory, certain personalty and the accounts receivable of the business. When the Lockharts defaulted on the repayment of their loan from the bank, the bank foreclosed and purchased both the real estate and personalty at sheriff’s sale. However, a dispute arose between [plaintiffs] and the bank regarding the priority of their respective liens against the business personalty. This dispute was settled by a written agreement, dated April 22, 1989, pursuant to which [plaintiffs], in exchange for $25,000, payable monthly, at a rate of $400, and certain interest in parts and business personalty, released the Lockharts ‘from any claims, debts or causes of action whatsoever, with the sole exception of the parties’ faithful performance of the terms of this agreement.’ [Plaintiffs] also agreed to release the bank, ‘from any claim whatsoever in connection with the bank’s execution upon personal property of Lockhart.’ The parties agreed that the contract constituted their entire agreement and that it could not be modified, except in writing, signed by the party against whom enforcement was sought. Pursuant to this agreement, the Lockharts forwarded monthly checks for $400 from June 1989 to March 1990. [Plaintiffs], [139]*139however, did not deposit or cash the same.” Knapp v. Lockhart, 777 Hbg. 1991, (March 8, 1993, memorandum opinion, pp. 2-3).

In that prior action, all defendants, the Lockharts and the bank, alleged that the claims asserted by plaintiffs had been released by the parties’ tripartite agreement. Plaintiffs admitted the agreement, but alleged fraud. The trial court determined that there was no arguable claim of fraud and entered summary judgment for the defendants. Plaintiffs appealed and the Superior Court affirmed the judgment.

Defendant’s motion for summary judgment in this action was filed first and, because a ruling favorable to defendant regarding either the issue of the statute of limitations or the status of the voluntary settlement agreement would render moot plaintiffs ’ motion for summary judgment, the court will first address defendant’s motion.

The standard for granting summary judgment requires a showing that “there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law.” Rossi v. Pennsylvania State University, 340 Pa. Super. 39, 45, 489 A.2d 828, 831 (1985). A trial court must “determine whether a genuine issue of material fact exists based upon an examination of the record in the light most favorable to the nonmoving party.” Johnson v. Baker, 346 Pa. Super. 183, 185, 499 A.2d 372, 373 (1985). “[I]f there is no issue as to any material fact, the moving party is entitled to [summary] judgment as a matter of law.” Mariscotti v. Tinari, 335 Pa. Super. 599, 601, 485 A.2d 56, 57 (1984).

When raising the issue of statute of limitations in a motion for summary judgment, contradictory evidence as to when the injury occurred or should have been discovered can present a genuine issue of material [140]*140fact as to when the statute of limitations began to run. Altoona Area School District v. Campbell, 152 Pa. Commw. 131, 618 A.2d 1129 (1992).

To address defendant’s motions for summary judgment, the court must apply the above standard to determine whether a genuine issue of material fact exists after examining the record in a light most favorable to plaintiffs, the non-moving party. Defendant argues that any claim against him is barred by the two-year statute of limitations for negligence. 42 Pa.C.S. §5524. Defendant further argues that plaintiffs should be barred from bringing any claim for attorney malpractice against defendant where, as here, plaintiffs voluntarily executed a settlement agreement and where, as here, plaintiffs have failed to plead with sufficient specificity their claim of fraud in the inducement. For this latter argument defendant relies upon Muhammad v. Strassburger, 526 Pa. 541, 587 A.2d 1346 (1991), and Miller v. Berschler, 423 Pa. Super. 405, 621 A.2d 595 (1993). In Muhammad, the Pennsylvania Supreme Court foreclosed “the ability of dissatisfied litigants to agree to a settlement and then file suit against their attorneys in the hope that they will recover additional monies. To permit otherwise results in unfairness to the attorneys who relied on their client’s assent and unfairness to the litigants whose cases have not yet been tried. Additionally, it places an unnecessarily arduous burden on an overly taxed court system.” Id.

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Bluebook (online)
30 Pa. D. & C.4th 136, Counsel Stack Legal Research, https://law.counselstack.com/opinion/knapp-v-murphy-pactcompltioga-1996.