Pittsburgh Logistics v. B. Keppel Trucking

• Court: Superior Court of Pennsylvania
• Decided: December 13, 2016
• Docket: 1943 WDA 2015
• Status: Unpublished

Opinion

J-A26019-16

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

PITTSBURGH LOGISTICS : IN THE SUPERIOR COURT OF SYSTEMS, INC. : PENNSYLVANIA : Appellant : : : v. : : : No. 1943 WDA 2015 B. KEPPEL TRUCKING, LLC :

Appeal from the Order December 1, 2015 In the Court of Common Pleas of Allegheny County Civil Division at No(s): G.D.13-18152

BEFORE: BENDER, P.J.E., RANSOM, J., and MUSMANNO, J.

MEMORANDUM BY RANSOM, J,: FILED DECEMBER 13, 2016

Pittsburgh Logistics Systems, Inc. (Appellant) appeals from the order

entered December 1, 2015, granting B. Keppel Trucking, LLC’s (Appellee)

petition to confirm an arbitration award and granting judgement thereon.

We affirm.

Appellant is a third-party logistics company that, among other

services, brokers transportation of freight between shippers and trucking

companies. See Pet. To Stay Arbitration 9/10/13. In September of 2009,

Appellant began doing business with Appellee, a large trucking company.

Keppel Dep., 12/3/15, 21:25. That month, an employee of Appellant called

to offer Appellee a load for pick-up. Spears Dep.,1/31/14, 8:23-9:10. The

parties orally agreed on the price of the shipment. Id. at 7:10. Appellee

then received a “carrier set-up packet” containing various forms, as well as J-A26019-16

the Motor Carrier Service Contract (“MCSC”). Id. at 10:20- 11:9. Appellee

signed and returned the documents to Appellant. Id. at 12:1-4.

Other carriers used Appellant’s web-based system, which enables

carriers to bid on loads posted by Appellant on behalf of its customers.

Homan Dep., 12/6/13, 23:5-16. If a carrier is awarded a shipment, the

carrier receives an email confirmation that contains a hyperlink to the

Appellant’s Carrier Terms of Use (”Terms of Use”). The Terms of Use do not

include an arbitration clause. See Carrier Terms of Use.

Regarding this first job, Appellee did not bid via the online system;

Appellant contacted Appellee directly. Spears Dep. at 8:23-9:10.

Nevertheless, twelve days after Appellee completed delivery, Appellant

emailed an award confirmation containing a hyperlink to the Terms of Use.

Id. at 9:11-20.

In May of 2012, Appellant contacted Appellee for assistance with

another client, Streamlite. Id. at 14:25, 15:1-25, 16:1-6. Appellant called

Appellee and other carriers for their pricing and ultimately awarded Appellee

the job. Id. Thereafter, Appellant received weekly email confirmations

arranging shipments for the following week. Keppel Dep. at 68:1-25, 69:1-

6. This practice continued until June 2012, when Streamlite abruptly went

out of business and Appellant stopped paying Appellee for shipments. Id. at

19:22-20:14. Appellant pursued legal action against Streamlite and was

able to recover a portion of Streamlite’s unpaid balance. See Affidavit of

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Ryan Boushell 5/13/14 at ¶ 10. Appellant offered Appellee $9,812.87, 19%

of the $50,513.15 owed to Appellee. Id. at ¶ 12.

Appellee refused payment and, on July 23, 2013, filed a demand for

arbitration against Appellant seeking payment of the full $50,513.15.

Appellant brought a Petition to Stay Arbitration pursuant to 42 Pa.C.S.A. §

7304(b), which the lower court denied. See Petition to Stay Arbitration,

10/21/13. The parties proceeded to arbitration, and ultimately Appellee was

awarded $50,952.09, plus $637.50 in costs. See Arbitration Award

2/20/15. Appellant filed a Petition to Vacate the Arbitration Award. On April

10, 2015, the Petition to Vacate was denied. Appellant filed an appeal,

which was quashed as premature. On December 1, 2015, the lower court

granted Appellee’s Petition to Confirm the Arbitration Award and entered

judgment in its favor. This appeal followed.

Appellant timely filed a court-ordered PA.R.A.P. 1925(b) statement.

The trial court issued a responsive opinion.

Appellant raises the following issue for review:

Did the Court of Common Pleas err in its denial of Appellant’s Petition to Stay arbitration and in its subsequent confirmation of the arbitration award were [sic] there was no enforceable arbitration agreement between the parties?

Appellant’s Brief at 5.

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Appellant contends the trial court erred in compelling arbitration of 1 Appellee’s claim for damages. Appellate courts employ a two-part test to

determine whether a trial court should have compelled arbitration: the court

must determine (1) whether a valid agreement to arbitrate exists, and (2)

whether the dispute is within the scope of the agreement. Pisano v.

Extendicare Homes, Inc., 77 A.3d 651, 654 (Pa. Super. 2013).

Appellant challenges the first part of this test. According to Appellant,

an arbitration award should not be enforced where it contemplates execution

by both parties, but not all parties sign. Appellant’s Brief at 16 (citing in

support Bair v. Manor Care of Elizabethtown, PA, LLC, 108 A.3d 94 (Pa.

Super. 2015)). Here, Appellant argues, it never signed the MCSC. Thus,

according to Appellant, the MCSC was merely a draft agreement and not

binding on the parties. Moreover, Appellant suggests that the parties never

operated under the terms of the MCSC. Appellant’s Brief at 16. Rather, ____________________________________________

1 Appellee asserts that Appellant has waived consideration of the claim it presents on appeal, suggesting that (1) its claim first arose in the context of interlocutory orders issued by the trial court, thus precluding appellate consideration now, (2) Appellant asserts arguments contrary to those raised before the trial court, and (3) Appellant has either omitted or stated issues vaguely. See Appellant’s Brief at 11-14. We disagree. First, Appellant could not pursue his appeal until entry of a final order or judgment, at which time, all previous, interlocutory issues may be raised. See McNeil v. Jordan, 894 A.2d 1260, 1266-67 (Pa. 2006). (noting that an appeal from “the entry of judgment will be viewed as drawing into question any prior non-final orders that produced the judgment”). Second, Appellant has consistently maintained that the MCSC does not constitute a binding agreement to arbitrate. See Petition to Stay, 10/8/13, ¶ 38. Thus, we decline to dismiss Appellant’s claim as waived.

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according to Appellant, the Carrier Terms of Use governed their relationship.

Id.

An agreement to arbitrate is a contract. United Steelworkers of

America, AFL-CIO v. Westinghouse Elec. Corp (Bettis Atomic Power

Lab.), 196 A.2d 857, 859 (Pa. 1964). Our standard of review is de novo,

and our scope is plenary. Bair, 108 A.3d at 96 (quoting Bucks

Orthopaedic Surgery Assoc., P.C. v. Ruth, 925 A.2d 868, 871 (Pa.

Super. 2007)). The touchstone of any valid contract is mutual assent and

consideration. Bair, 108 A.3d at 96; Weavertown Transp. Leasing Inc.

v. Moran, 834 A.2d 1169, 1172 (Pa. Super. 2003).

Appellant’s reliance on Bair is misplaced. In Bair, following the death

of her mother, plaintiff, as executrix of her mother’s estate, commenced a

wrongful death action against the operator of her mother’s healthcare

facility. Bair, 108 A.3d at 95. The healthcare facility sought to enforce an

arbitration agreement signed by the plaintiff acting under power of attorney.

Id. Despite a signature line for both parties, the healthcare facility never

signed the agreement. Id. at 97. The trial court declined to enforce the

agreement, and the healthcare facility appealed. Id. at 96. This Court

affirmed, concluding that the failure of the defendant to sign the arbitration

agreement precluded the defendant from enforcing the agreement against

the plaintiff. Id. at 97. However, as noted by Appellee, this Court’s decision

was not rooted solely in the healthcare facility’s mere failure to sign the

arbitration agreement.

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“[t]he issue is not whether the arbitration agreement was signed by the party sought to be bound, but whether there was a meeting of the minds, that is, whether the parties agreed in a clear and unmistakable manner to arbitrate their disputes.”

Appellee’s Brief at 17 (quoting Bair, 108 A.3d at 97; emphasis omitted).

Here, the lack of Appellant’s signature does not render the MCSC

invalid. The court in Bair noted, “[T]he absence of signatures is not fatal

unless required by law or by the intent of the parties…” Bair, 108 A.3d at

98; Shovel Transfer Storage, Inc., v. Pa. Liquor Control Bd., 739 A.2d

133, 136 (Pa. 1999) (“As a general rule, signatures are not required unless

signing of contract is expressly required by law or the intent of the

parties.”).

The contract language set forth in the MCSC does not explicitly require

Appellant’s signature. In the MCSC, the line preceding the signature lines

state, “In witness whereof, the parties, intending to be legally bound, have

set their hands and seals the day and year first above written.” See MCSC

Agreement at 12. This statement is not an express requirement for both

parties’ signatures. The phrase “legally bound” constitutes consideration for

the contract. Socko v. Mid-Atlantic Sys. Of CPA, Inc., 126 A.3d 1266

(Pa. 2015) (holding that the term “legally bound” is interpreted by 33 P.S. §

6 to supply the necessary consideration for an agreement.)

Appellant also references Franklin Interiors v. Wall of Fame Mgmt.

Co. Inc., 511 A.2d 761 (Pa. 1986) and Commonwealth v. On-Point Tech.

Sys., Inc., 821 A.2d 641 (Pa. Commw. Ct. 2003) in support of its argument

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that the MCSC is merely a draft, as Appellants did not sign the agreement.

However, both cases are distinguishable, as the contracts at issue included

explicit language requiring a signature. For example, in Franklin Interiors,

the Supreme Court determined that an explicit requirement flowed from

contractual language stating, “[t]his document does not become a final

contract until approved by an officer of Franklin Interiors.” Franklin 511

A.2d at 763. Similarly, in On-Point Tech., the Commonwealth Court

rejected a party’s contention that a binding contract was formed, where the

contracted language expressly required signatures. On-Point Tech, 821

A.2d at 643.

Moreover, there is clear evidence of Appellant’s intent to be bound by

the terms of the MCSC. At the beginning of their relationship, a

representative from Appellant’s company contacted Appellee and provided

them with the MCSC to sign and return. Furthermore, Appellant informed

Appellee that until Appellee signed and returned the MCSC, they would not

receive payment. Spears Dep. at 12:13-17. In contrast, Appellee did not

receive the Carrier Terms of Use agreement until two weeks after they

completed their delivery.

Appellant suggests that the Carrier Terms of Use controlled the

parties. We disagree. There is no evidence that the parties operated under

the Terms of Use agreement. During the course of their business, Appellee

never placed a bid via Appellant’s online system. Appellee did not receive

the Terms of Use in advance of their first job, and there is no evidence that

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the Terms of Use were negotiated or accepted. Rather, the terms were

forwarded to Appellee as a hyperlink in an email received by Appellee after

the job was accepted and completed. Based on the language in the MCSC

and the business practices between the two parties, the Terms of Use

agreement does not constitute a contract.

The MCSC constitutes a valid agreement to arbitrate and is binding

upon the parties. Thus, the trial court did not err in denying Appellant’s

Petition to Stay and confirming the subsequent arbitration award.

Order affirmed. Judgment Entered.

Joseph D. Seletyn, Esq. Prothonotary

Date: 12/13/2016

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