J-A14038-24
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37
PYRAMID PHILADELPHIA : IN THE SUPERIOR COURT OF MANAGEMENT, LLC, BY AND : PENNSYLVANIA THROUGH ITS ASSIGNEE OLD : REPUBLIC INSURANCE GROUP : : : v. : : : GALLAGHER BASSETT SERVICES, INC. : _____________________________ : OLD REPUBLIC INSURANCE COMPANY : AS ASSIGNEE OF PYRAMID : PHILADELPHIA MANAGEMENT, LLC AND : OLD REPUBLIC INSURANCE COMPANY : IN ITS OWN RIGHT : : : v. : : : WILLIAM E. MALONE AND MUAI, : MALONE, DAUBENBERGER, LLP : : : APPEAL OF: PYRAMID PHILADELPHIA : MANAGEMENT, LLC, BY AND THROUGH : ITS ASSIGNEE OLD REPUBLIC GROUP : No. 698 EDA 2023
Appeal from the Order Entered February 13, 2023 In the Court of Common Pleas of Philadelphia County Civil Division at No(s): 190803121, 191200733
PYRAMID PHILADELPHIA : IN THE SUPERIOR COURT OF MANAGEMENT, LLC, BY AND : PENNSYLVANIA THROUGH ITS ASSIGNEE OLD : REPUBLIC INSURANCE GROUP : : : v. : : J-A14038-24
GALLAGHER BASSETT SERVICES, INC. : _______________________________ : OLD REPUBLIC INSURANCE COMPANY : AS ASSIGNEE OF PYRAMID : PHILADELPHIA MANAGEMENT, LLC : AND OLD REPUBLIC INSURANCE : COMPANY IN ITS OWN RIGHT : : v. : : : WILLIAM E. MALONE AND MUAI, : MALONE, DAUBENBERGER, LLP : : : APPEAL OF: PYRAMID PHILADELPHIA : MANAGEMENT, LLC, BY AND : THROUGH ITS ASSIGNEE OLD : No. 700 EDA 2023 REPUBLIC GROUP
Appeal from the Order Entered February 24, 2023 In the Court of Common Pleas of Philadelphia County Civil Division at No(s): 190803121, 191200733
BEFORE: LAZARUS, P.J., STABILE, J., and LANE, J.
MEMORANDUM BY LANE, J.: FILED AUGUST 1, 2024
Pyramid Philadelphia Management, LLC (“Pyramid”), by and through its
assignee, Old Republic Insurance Group (“ORIC”), and ORIC, in its own right
and as assignee of Pyramid, appeal from the orders granting summary
judgment in favor of Gallagher Bassett Services, Inc. (“GBS”), William E.
Malone, Esquire, and Musi, Malone, Daubenberger, LLP (collectively, “Malone”),
and dismissing all claims against GBS and Malone with prejudice. We affirm.
These consolidated appeals, concerning claims for breach of contract and
legal malpractice, derive from the claims handling by GBS and the legal
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representation provided by Malone in relation to a worker’s compensation claim
filed against Pyramid by Alexandre Linnik (“Linnik”). The operative facts
pertinent to these appeals are as follows.
ORIC is an insurance company which provides coverage to employers for
workers’ compensation claims. To assist with the discharge of its coverage
obligations, ORIC contracted with GBS through a Master Claims Service
Contract (“Contract”). The Contract required GBS to act as a third-party
administrator (“TPA”) to adjust workers’ compensation claims filed against
certain of ORIC’s insureds.1 In return, ORIC agreed to “pay [GBS] the claims
fees negotiated with ‘Insured.’” Contract, 3/19/14, at 8. ORIC and GBS are
the only parties to the Contract. Moreover, the Contract specifically provided,
“[t]his Contract is for the sole benefit of the parties hereto and in no event shall
Contract be constructed to be for the benefit of any third party and neither ORIC
nor [GBS] shall be liable for any loss, liability[,] damages[,] or expense to any
person not a party to this Contract.” Id. at 10. The Contract further provided
that “[n]o assignment by either party of this Contract shall be valid without the
written consent of the other party, which consent shall be reasonably given.”
Id.
____________________________________________
1 Appended to the Contract was “Exhibit A,” which was amended on several occasions. Each version of Exhibit A listed over 500 insurance policies and the corresponding insureds for which GBS was to serve as a TPA in relation to workers’ compensation claims filed against those insureds. See Contract, 3/19/14, at 1, Exhibit A. Pyramid was one of the insureds listed in Exhibit A, and, thus, an insured for which GBS was to provide claims handling services.
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In 2001, Linnik began working as a banquet server at a hotel in the
Penns Landing area of Philadelphia which was operated by Hyatt. In February
2015, Hyatt ceased to operate the hotel, and the hotel was rebranded as a
Hilton hotel. Hilton was not involved in the operation or management of the
hotel. Instead, commencing on February 26, 2015, Pyramid took over the
operation and management of the hotel, and the employees of the hotel
ceased to be employed by Hyatt and became employees of Pyramid.
Linnik worked at the hotel until March 10, 2015. Thus, although he had
been employed by Hyatt for most of his employment at the hotel, he was
employed by Pyramid for the last ten days of his employment and his last
paycheck was issued by Pyramid. On March 18, 2015, Linnik underwent
elective back surgery. Due to complications from surgery, including a fungal
infection, Linnik was unable to return to work at the hotel.
On February 27, 2017, Linnik filed a worker’s compensation claim
petition against Hilton (“the Hilton claim”). On May 8, 2017, Linnik filed a
worker’s compensation claim petition against Hyatt (“the Hyatt claim”). On
May 15, 2017, Linnik filed a worker’s compensation claim petition against
Pyramid (“the Pyramid claim”).
In all three claim petitions, Linnik alleged that: he developed L3-4 and
L5-S1 disc herniations in his back causing right L5 radiculopathy, requiring
surgical intervention; his back injury was caused by “[c]umulative trauma
sustained during the course of 14 years as a banquet server;” and the date of
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his injury was March 10, 2015. See The Pyramid Claim, 5/15/17, at 2; see
also The Hilton Claim, 2/27/17, at 2; The Hyatt Claim, 5/8/17, at 2.2
Service of the Pyramid claim was made to Pyramid on May 17, 2017.
Pyramid had twenty days from the date of service, until June 6, 2017, to file an
answer. On June 1, 2017, Provost Associates, a risk management firm engaged
by Pyramid, submitted the Pyramid claim to GBS via an encrypted email. No
answer was filed on or before June 6, 2017. Pyramid neither requested nor was
granted an extension. The workers’ compensation judge (“WCJ”) scheduled a
hearing for June 19, 2017, at which Pyramid failed to appear. Pyramid provided
no excuse for its failure to appear. Linnik then filed a Yellow Freight3 motion
against Pyramid for failure to file a timely answer. On August 28, 2017, the
WCJ granted the Yellow Freight motion.
2 Importantly, as discussed infra, in each claim petition, Linnik alleged that he
suffered a cumulative trauma injury. In cases where a cumulative trauma injury is asserted, such that the claimant asserts that each day of employment constituted a new injury which further aggravated the condition, the employer at the time of the last aggravation is liable for the payment of the claimant’s compensation benefits. See e.g., C.P. Martin Ford, Inc. v. Workers’ Compensation Appeal Board (Resad Dzubur & Norristown Ford), 767 A.2d 1164, 1166-67 (Pa. Cmwlth. 2001). Linnik asserted in each of his claim petitions that the date of his cumulative trauma injury was March 10, 2015, which was the last day of his employment with Pyramid.
3 See Yellow Freight Sys., Inc. v. Workmen's Comp, Appeal Bd., 423 A.2d
1125, 1127 (Pa. Cmwlth. 1981) (holding that an answer to a workers’ compensation claim must be filed within twenty days after assignment to a WCJ, and that failure to do so absent an adequate excuse will result in the admission of every well-pleaded factual allegation in the claim petition and the preclusion by the employer from challenging the factual allegations in the claim petition).
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As of October 13, 2017, GBS had not assigned legal counsel to represent
Pyramid, and no answer had been filed in relation to the Pyramid claim. At
some point after October 13, 2017, GBS assigned Malone to represent Pyramid.
On October 20, 2017, even though the answer deadline had passed and a
Yellow Frieght order had been entered against Pyramid, Malone filed an
answer on behalf of Pyramid. At a hearing conducted on December 4, 2017,
Malone appeared on behalf of Hilton and Pyramid.4 Malone confirmed that
Pyramid was Linnik’s employer on the last day of his employment for the hotel
and did not object to the dismissal of the claims against Hilton and Hyatt.
In the Pyramid claim proceedings, Linnik was deposed and testified at a
hearing before the WCJ. Linnik also presented the deposition testimony of his
treating neurosurgeon, Charles Munyon, M.D. Malone presented the deposition
testimony and report of Armando A. Mendez, M.D., an orthopedic surgeon who
conducted an independent medical exam (“IME”) of Linnik. In his report, Dr.
Mendez could not identify a specific trauma which could be considered the cause
of Linnik’s injury. Instead, Dr. Mendez concluded that Linnik’s fourteen years
of employment at the hotel could have caused or aggravated the disc herniation
in his back:
By way of his history, [Linnik] has had some chronic ongoing back pain since 2002[,] within a year of starting to work [at the hotel]. He did not relate to me anyone [sic] specific event that
4 On behalf of a different insurer, GBS had separately assigned Malone to defend
Hilton against the Hilton claim.
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caused a disc herniation or acute exacerbation of his back or leg pain . . ..
. . . [Linnik] certainly had a physical job that required him to do a significant amount of lifting, bending, pushing and pulling[,] and the nature of that job could potentially been [sic] the cause of a disc herniation at the L5-S1 level. Therefore, unfortunately, I do not feel that I can, to a reasonable degree of medical certainty, give an opinion as to whether or not this injury occurred at work and is work[-]related or not. . . . Certainly[,] the type of job that he was doing could cause a disc herniation[,] and I am willing to state that from a medical perspective[,] the nature of the physical job that he had could have resulted in trauma that would have caused a disc herniation. However, I do not have any information that would lead me to conclude that he did have a specific event in the course of his job that caused the disc to herniate as a result specifically due to his work activity or duties.
Mendez Report, 12/12/17, at 7.
In March 2018, given that Pyramid was the undisputed employer on
Linnik’s last day of work and Dr. Mendez’s report did not provide a medical
defense to Linnik’s cumulative trauma injury, Malone requested authorization
to settle the Pyramid claim. Pyramid declined and requested reassignment of
its defense to another law firm. Pyramid’s request was honored, and Malone’s
representation was terminated. Pyramid’s replacement counsel asserted that
Pyramid was not Linnik’s employer, and that Hyatt should be regarded as the
responsible employer. However, the only evidence submitted by Pyramid in
support of its defense was Linnik’s 2015 W-2, which merely reflected that Linnik
was employed by Hyatt at some unspecified point in 2015. Linnik, on the other
hand, produced a paystub from Pyramid for the period March 1, 2015, through
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March 14, 2014, which spanned his last ten days of work at the hotel and his
date of injury.
On December 26, 2018, the WCJ issued a decision wherein it credited the
testimony and evidence presented by Linnik, and made the following findings
of fact: Linnik began working as a banquet server at the hotel in 2001; he began
experiencing back pain in 2002; he began treating for his back pain in 2007;
he suffered a cumulative trauma injury as a result of working as a banquet
server at the hotel for fourteen years; his injury consisted of disc herniations
and radiculopathy; he underwent five surgeries and spent nearly 700 days in
the hospital as a result of his cumulative trauma injury; he developed a surgical
wound fungal infection after the second surgery; he is recovered from his disc
herniations; he is not fully recovered from the radiculopathy or the fungal
infection; he cannot return to work; Pyramid issued Linnik a paycheck for the
period from March 1, 2015 to March 14, 2015; Pyramid is the responsible party
because it was Linnik’s employer on March 10, 2015, which is the date of injury.
Decision, 12/26/18, at 3-9. Pyramid appealed the WCJ’s decision; however,
the decision was affirmed by the Workers’ Compensation Appeal Board.
Thereafter, Pyramid filed a lawsuit against GBS, asserting claims for
breach of the Contract and unjust enrichment (“the GBS action”). Pyramid
purported to bring its claims by and through its assignee, ORIC. GBS filed a
third-party complaint to join Malone as a third-party defendant in the GBS
action.
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ORIC filed a lawsuit, both in its own right and as assignee of Pyramid,
against Malone (“the Malone action”). Therein, ORIC asserted claims of legal
malpractice based on its position that Pyramid was not Linnik’s employer, that
Hyatt was Linnik’s employer, and that Malone should not have permitted the
Hyatt claim to be dismissed. ORIC further averred that Malone’s failure to file
a timely answer to the Pyramid claim precluded Pyramid from challenging its
status as an employer due to the Yellow Freight order.
The actions were consolidated for purposes of discovery and trial. During
discovery, as related to the GBS action, Pyramid was unable to produce any
evidence that GBS consented to any purported assignment by ORIC of its rights
under the Contract. As related to the Malone action, ORIC submitted the
untimely expert report of Daniel J. Siegel, Esquire (“the Siegel Report”),
wherein he posited that, if Malone had conducted a timely and thorough
investigation, Pyramid would not have been found to be the responsible party.
However, the Siegel Report did not identify any new fact that Malone might
have uncovered through a more thorough investigation, or explain how any
party other than Pyramid was responsible for Linnik’s cumulative trauma injury.
Both GBS and Malone filed motions for summary judgment.
On February 13, 2023, the trial court granted both motions, and
dismissed the claims against GBS and Malone with prejudice. The trial court
granted GBS’s motion on the basis that: Pyramid was not a party to the
Contract; Pyramid was not a third-party beneficiary under the Contract because
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the Contract expressly stated that it was not for the benefit of any third party;
and Pyramid provided no evidence that GBS consented to any purported
assignment by ORIC of its rights under the Contract. The trial court granted
Malone’s motion on the basis that: ORIC offered no evidence of an attorney-
client relationship between it and Malone; ORIC offered no evidence that Malone
had been assigned to represent Pyramid prior to the entry of the Yellow
Freight order; and ORIC offered no evidence that Hyatt was liable for Linnik’s
injuries. On February 24, 2023, the trial court amended the order granting
Malone’s motion for summary judgment to clarify that the order encompassed
both the first-party and third-party claims asserted against Malone. Pyramid
and ORIC filed separate timely notices of appeal. This Court consolidated the
appeals sua sponte. Thereafter, Pyramid and ORIC (collectively, “Appellants”)
filed a consolidated court-ordered Pa.R.A.P. 1925(b) statement.5 The trial court
then authored a Rule 1925(a) opinion.
Appellants filed a consolidated brief in which they raise the following
issues for our review in connection with the GBS action:
1. Did [Pyramid] raise issues of material fact below sufficient to defeat summary judgment on whether it has presented a cognizable claim for breach of the . . . Contract?
2. As a matter of law, was [Pyramid’s] unjust enrichment claim precluded by its breach of contract claim? ____________________________________________
5 The trial court noted that the Rule 1925(b) statement consists of eight pages
with seventeen paragraphs and ten subparts, and that “[m]uch of the statement was inappropriate with respect to decorum or the purposes sought.” Trial Court Opinion, 11/15/23, at 4 (footnote omitted).
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Appellant’s Brief at 6.
Appellants raise the following issues for our review in connection with the
Malone action:
1. Was the dismissal of [the legal malpractice claim] erroneous, since [Appellants] raised disputed issues of fact sufficient to defeat summary judgment with respect to whether [Pyramid] had a viable defense in the underlying proceeding, and the failure to present that defense was a breach of the standard of care by . . . Malone?
2. As a matter of law, does the entry of a Yellow Freight order preclude [Appellants’ legal] malpractice claims against . . . Malone . . .?
3. Should the Siegel Report have been rejected as speculative or conjectural?
4. Should . . . the Siegel Report . . . have been rejected as untimely, when it was submitted one business day late and Attorney Malone . . . did not point to any bad faith on [Appellants’] part or any resulting prejudice?
Appellants’ Brief at 5 (quotation marks omitted, issues reordered).
In reviewing a grant of summary judgment, an appellate court’s
standard of review is de novo and the scope of review is plenary. See
Bourgeois v. Snow Time, Inc., 242 A.3d 637, 649-50 (Pa. 2020). Further,
when reviewing such an order:
We view the record in the light most favorable to the nonmoving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party. Only where there is no genuine issue as to any material fact and it is clear that the moving party is entitled to a judgment as a matter of law will summary judgment be entered. Our scope of review of a trial court’s order granting or denying summary judgment is plenary, and our standard of review is clear: the trial court’s order
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will be reversed only where it is established that the court committed an error of law or abused its discretion.
Phillips v. Lock, 86 A.3d 906, 912-13 (citation omitted).
We initially address the issues raised by Appellants in connection with the
GBS action. In their first issue, Appellants contend that the trial court erred in
granting summary judgment on Pyramid’s breach of contract claim against
GBS. Generally, to successfully maintain a cause of action for breach of
contract, the plaintiff must establish: (1) the existence of a contract, including
its essential terms; (2) a breach of a duty imposed by the contract; and (3)
resultant damages. See Albert v. Erie Ins. Exch., 65 A.3d 923, 928 (Pa.
Super. 2013).
Appellants concede that Pyramid did not sign or execute the Contract.
Nevertheless, Appellants argue that Pyramid was a party to the Contract.
Appellants point to the language of the Contract which permitted ORIC’s
insureds to negotiate fees with GBS: “[GBS] agrees to accept from the ‘Insured’
those fees and other charges as may be negotiated by [GBS] and the ‘Insured.’”
Contract 3/19/14, at 1.6 Appellants seemingly argue that, because Pyramid, as
an insured, was permitted to negotiate claims handling fees with GBS, the
reference in the Contract to an insured’s ability to negotiate such fees had the
effect of making Pyramid a party to the Contract.
6 Notably, the Contract expressly provides elsewhere that ORIC, and not any
insured, was obligated to “pay [GBS] the claims fees negotiated with ‘Insured.’” Contract, 3/19/14, at 8.
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Appellants further claim that the conduct of the parties during the
handling of the Pyramid claim indicates that Pyramid was a party to the Contract
because: the GBS claims adjuster referred to Pyramid as “a client;” Pyramid
was permitted to report its claims directly to GBS rather than to ORIC; and GBS
gave Pyramid direct access to its computerized claim files. Appellants’ Brief at
52. Appellants insist that, at a minimum, this conduct created an issue of fact
as to whether Pyramid was a party to the Agreement.
In the alternative, Appellants contend that Pyramid was a third-party
beneficiary under the Contract. Appellants concede that the Contract explicitly
states that it is to be construed for the sole benefit of ORIC and GBS, and not
for the benefit of any third party. Nonetheless, Appellants argue that these
contractual provisions conflict with the conduct of the parties, and the
provisions of the Contract which reference Pyramid’s ability to negotiate fees
with GBS. According to Appellants, this conflict created a genuine issue of fact
as to whether the parties intended that Pyramid should be a third-party
beneficiary to the Contract.7
As indicated above, the trial court determined that: Pyramid was not a
party to the Contract; Pyramid was not a third-party beneficiary under the
Contract because the Contract expressly stated that it was not for the benefit
7 Appellants cite no controlling authority for their arguments and, instead, indicate that “there does not appear to be a lot of case law on the issue.” Appellants’ Brief at 54.
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of any third party; and Pyramid provided no evidence that GBS consented to
any purported assignment by ORIC of its rights under the Contract. See Trial
Court Opinion, 11/15/23, at 16.
Viewing the record in the light most favorable to Pyramid, as the
nonmoving party, and resolving all doubts as to the existence of a genuine issue
of material fact against GBS, we discern no error of law or abuse of discretion
by the trial court in granting GBS’s motion for summary judgment on Pyramid’s
claim for breach of contract. In the complaint, Pyramid made clear that only
its rights against GBS were being asserted, albeit through Pyramid’s assignee,
ORIC. See Complaint, 8/28/20, at 1-2, ¶ 4. The complaint does not purport
to assert any rights held by ORIC. Notwithstanding, the only contract referred
to in the complaint is the Contract executed between ORIC and GBS. See id.
at ¶¶ 44-53. Indeed, the complaint expressly avers that “[t]he . . . Contract .
. . creates a duty running from [GBS] to [ORIC] . . ..” Id. at ¶ 45. Thus, the
record is clear that Pyramid was not a party to the only contract identified in
the claim for breach of contract.
With respect to Appellants’ claim that Pyramid was a third-party
beneficiary to the Contract, our Pennsylvania Supreme Court has stated:
A party becomes a third party beneficiary only where both parties to the contract express an intention to benefit the third party in the contract itself, unless the circumstances are so compelling that recognition of the beneficiary’s right is appropriate to effectuate the intention of the parties, and the performance satisfies an obligation of the promisee to pay money to the beneficiary or the circumstances indicate that the promisee
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intends to give the beneficiary the benefit of the promised performance.
Scarpitti v. Weborg, 609 A.2d 147, 150-51 (Pa. 1992).
Here, the clear language of the Contract indicates that ORIC and GBS did
not intend for Pyramid or any other insured to be a third-party beneficiary.
Indeed, the Contract specifically provided, “[t]his Contract is for the sole benefit
of the parties hereto and in no event shall Contract be constructed to be for the
benefit of any third party and neither ORIC nor [GBS] shall be liable for any
loss, liability damages or expense to any person not a party to this Contract.”
Contract, 3/19/14, at 10.
Moreover, the circumstances in this case are not so compelling that we
may override the parties’ clear contractual intent that Pyramid is not a third-
party beneficiary to the Contract. In Pennsylvania, adjusters owe a duty of
performance to their principals, the insurance companies. See Bleday v. OUM
Grp., et al., 645 A.2d 1358, 1363 (Pa. Super. 1994), appeal denied, 655 A.2d
981 (Pa. 1995). However, this duty does not serve to create a contractual
obligation between the adjusters and the insured. Id. To be sure, an adjuster
cannot be liable on a contract (i.e., the insurance policy) to which it was not a
party and never assumed. Id. Thus, although GBS owed a contractual duty to
ORIC under the Contract, GBS was not a party to the insurance policy issued
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by ORIC to Pyramid and, therefore, owed no contractual duty to Pyramid. Id.8
That an employee of GBS may have referred to Pyramid as a client, permitted
Pyramid to report claims directly to GBS, or permitted Pyramid direct access to
GBS’s computerized claim files does not alter the fact that GBS owed no
contractual obligation to Pyramid. Accordingly, as the undisputed facts of
record establish that Pyramid was neither a party to or a third-party beneficiary
of the Contract, we discern no error or abuse of discretion by the trial court in
granting summary judgment on Pyramid’s breach of contract claim in the GBS
In Appellants’ second issue in the GBS action, they contend that the
trial court erred in dismissing Pyramid’s claim for unjust enrichment. In
considering this issue, we are mindful that unjust enrichment is an equitable
doctrine consisting of the following elements: (1) benefits conferred on
defendant by plaintiff; (2) appreciation of such benefits by defendant; (3)
acceptance and retention of such benefits under such circumstances that it
would be inequitable for defendant to retain the benefit without payment of
value. See Karden Constr. Servs., Inc. v. D'Amico, 219 A.3d 619, 628
(Pa. Super. 2019).
8 Notably, Pennsylvania courts permit an insured, such as Pyramid, to sue its
insurer for the actions of the insurer’s agents, including claims adjusters. See, e.g., Bruno v. Erie Ins. Co., 106 A.3d 48, 70 (Pa. 2014). Thus, Pyramid could have sued ORIC for any perceived mishandling by GBS of the Pyramid claim. Id.
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According to Appellants, the trial court dismissed Pyramid’s claim for
unjust enrichment due to the trial court’s finding that Pyramid lacked standing
to assert a claim for breach of contract under the Contract. Appellants assert
that Pyramid asserted a claim for unjust enrichment, based on principles of
equity, “for money expended by Pyramid (or [ORIC] on [Pyramid’s] behalf) for
the services provided by [GBS].” Appellants’ Brief at 61.
In the complaint, Pyramid expressly conditioned its claim for unjust
enrichment “[t]o the extent it is determined that there is no valid contract
between [ORIC] and [GBS].” Complaint, 8/28/20, at ¶ 55 (emphasis added).
Indeed, Pyramid clarified that its claim for unjust enrichment was “therefore
pleaded only in the alternative.” Id. Having determined that there is a valid
contract between ORIC and GBS, we conclude that consideration of Pyramid’s
alternative theory of unjust enrichment is unnecessary.9
Nevertheless, on the record before us, we discern no error or abuse of
discretion by the trial court in finding that Pyramid failed to raise an issue of
material fact related to this claim. Pyramid has not identified any benefit that
it conferred on GBS, any appreciation of such benefit by GBS, or any acceptance
and retention of such benefits under such circumstances that it would be
9 We note that the trial court did not address Appellants’ claim for unjust enrichment in its opinion, perhaps due to the claim being pleaded in the alternative. Nevertheless, we may affirm the trial court’s ruling on any basis. See In re T.P., 78 A.3d 1166, 1170 (Pa. Super. 2013) (holding that this Court may affirm a trial court’s ruling on any valid basis appearing of record).
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inequitable for GBS to retain the benefits without payment of value. See
Karden Constr. Servs., Inc., 219 A.3d at 628. Indeed, the only benefit
identified in the complaint as being conferred on GBS was conferred by ORIC
and not Pyramid: “[ORIC] conferred a benefit on [GBS] by paying [GBS] for its
third-party administrator services on each policy, including but not limited to
for the policy held by Pyramid.” Complaint, 8/28/20, at ¶ 56. Thus, as the
record is devoid of any benefit conferred on GBS by Pyramid, we discern no
error or abuse of discretion by the trial court in granting summary judgment on
Pyramid’s unjust enrichment claim in the GBS action.
Given our determination that the trial court did not err or abuse its
discretion in granting summary judgment on all claims asserted against GBS in
the GBS action,10 we now address Appellants’ issues pertaining to the Malone
As each of Appellants’ claims in the Malone action are interrelated, we
will address them together. Appellants contend that the entry of summary
judgment was improper because they raised an issue of material fact regarding
their claim for legal malpractice. In order to establish an action for legal
malpractice, an aggrieved client must demonstrate: (1) the employment of the
attorney or other basis for duty; (2) the failure of the attorney to exercise
10 As no party has challenged the entry of summary judgment in favor of Malone
on GBS’s third-party claims against Malone in the GBS action, we need not address that ruling.
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ordinary skill and knowledge; and (3) damages proximately caused by the
negligence. See Kituskie v. Corbman, 714 A.2d 1027, 1029-30 (Pa. 1998).
A legal malpractice action in Pennsylvania requires the plaintiff to prove that
the attorney he hired was negligent in prosecuting or defending the underlying
case. Id. at 1030. To prove actual injury, the appellant must demonstrate that
he would have prevailed in the underlying action in the absence of the attorney’s
alleged negligence. See Myers v. Robert Lewis Seigle, P.C., 51 A.2d 1182,
1185 (Pa. Super. 2000). Thus, in order to withstand summary judgment on
their legal malpractice claim, Appellants were required to allege facts which, if
proved, would establish that they would have prevailed in their underlying
workers’ compensation action but for Malone’s negligence.
Generally, a workers’ compensation claimant bears the burden of proof in
a claim petition proceeding to establish the existence of a work-related injury
and that the injury continues to cause disability throughout the pendency of the
claim petition. See School Dist. of Phila. v. Workers' Comp. Appeal Bd.
(Hilton), 117 A.3d 232, 245-46 (Pa. Cmwlth. 2015). With respect to an alleged
cumulative trauma injury, if an incident materially contributes to a previous
work-related injury, a new injury, or “aggravation,” has occurred. McNulty v.
Workers' Comp. Appeal Bd. (McNulty Tool & Die), 804 A.2d 1260, 1263
(Pa. Cmwlth. 2002). However, if a compensable disability results directly from
a prior injury but manifests itself on the occasion of an intervening incident,
which does not contribute materially to the disability, then the claimant has
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suffered a “recurrence.” Id. In the “recurrence” scenario the second employer
has no responsibility at all because the second event has not materially
contributed to the claimant’s current condition. S. Abington Twp. v.
Workers' Comp. Appeal Bd. (Becker), 831 A.2d 175, 182 (Pa. Cmwlth.
2003). However, in the case of an “aggravation,” the second employer bears
the entire responsibility for the claimant’s recent loss of earning power despite
the fact that both injuries materially contributed to his current physical
condition. Id. If the sequence of events is not sufficient to establish whether
a claimant has suffered an aggravation or a recurrence, unequivocal medical
testimony is essential. See McNulty, 804 A.2d at 1263. Whether a disability
results from an “aggravation” of a pre-existing condition or a “recurrence” of a
prior injury is a question of fact to be determined by the WCJ. See Reliable
Foods, Inc. v. W.C.A.B. (Horrocks), 660 A.2d 162, 166 (Pa. Cmwlth. 1995).
Section 416 of the Workers’ Compensation Act (“the Act”) 11 requires an
adverse party to file an answer to a claim petition within twenty days of service.
See 77 P.S. § 821. Pursuant to the Act, when an employer fails, without
adequate excuse, to file a timely answer to the claim petition, the employer is
deemed to have admitted the factual allegations in the claim petition. See id.;
see also Yellow Freight, 423 A.2d at 1127. Following the entry of a Yellow
Freight order, the employer is barred from presenting any affirmative defenses
11 See 77 P.S. §§ 1, et seq.
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or challenges to the factual allegations in the claim petition, having admitted to
the truth of every such factual allegation, and the claimant is not required to
corroborate the allegations in his claim petition, as these allegations stand on
their own as competent evidence. See Heraeus Electro Nite Co. v.
Workmen's Comp. Appeal Bd. (Ulrich), 697 A.2d 603, 608 (Pa. Cmwlth.
1997).
In cases where expert testimony is necessary, the expert’s opinion must
be made within a reasonable degree of certainty and cannot be based on
conjecture or surmise. See Pa.R.E. 703; see also Gillingham v. Consol
Energy, Inc., 51 A.3d 841, 849 (Pa. Super. 2012). It is not sufficient to state
that something might or could have happened:
No matter how skilled or experienced the [expert] witness may be, he will not be permitted to guess or to state a judgment based on mere conjecture.
Moreover, expert testimony, to have any evidentiary value, must state with some positiveness that a given state of affairs is the result of a given cause. It is not enough to say that something could have happened. Anybody can guess. Expert testimony must assert that it is the professional opinion of the witness that the result in question came from the cause alleged.
Smail v. Flock, 180 A.2d 59, 61 (Pa. 1962) (emphasis in original, citation and
footnote omitted); see also Collins v. Hand, 246 A.2d 398, 404 (Pa. 1968)
(holding that, no matter how skilled or experienced the witness may be, he will
not be permitted to guess or to state a judgment based on mere conjecture).
Appellants concede that, before Malone had been assigned to defend
Pyramid, a Yellow Freight order had been entered and all factual assertions
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in the Pyramid claim had been deemed admitted. Appellants nevertheless claim
that Pyramid had a viable defense because the facts asserted in the Pyramid
claim, although deemed true, were insufficient to establish that Pyramid was
the responsible party. Appellants maintain that Linnik was required to submit
medical evidence establishing a new injury or the material aggravation of a
previous injury during the ten days he was employed by Pyramid. Appellants
claim that Linnik failed to meet this burden because he presented no medical
evidence to support his claim of work-related trauma injury, or any claim that
his prior injury was materially aggravated during his brief time of work for
Pyramid. Appellants point out that Dr. Mendez’s report did not establish any
new injury during Linnik’s employment with Pyramid. Appellants claim that the
fact that Linnik scheduled his surgery while he was still employed by Hyatt, and
before he became an employee of Pyramid, permitted an inference that Linnik’s
injury had already occurred during the fourteen years he worked for Hyatt, and
that no additional traumatic injury or material aggravation occurred during the
single pay period in which he was subsequently employed by Pyramid.
Appellants maintain that Malone had “more than sufficient evidence to
prove . . . that Linnik’s claim was not supportable, and argue a successful
defense for Pyramid.” Appellants’ Brief at 37 (quotation marks omitted).
Appellants argue that “Malone performed little, if any, investigation and took
almost no discovery with respect to the issues raised by Linnik’s claim; [and]
the discovery that was taken occurred after Malone conceded on the record that
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Pyramid was the only potentially liable employer.” Id. Appellants assert that
“if Malone had argued the applicable Pennsylvania law (of which the [WCJ] was
seemingly unaware), Linnik’s failure to meet his burden, the Mendez
evidence[,] and advocated for the required result, he would have succeeded on
behalf of Pyramid.” Id. at 38. Appellants assert that “Pyramid’s winning case
evaporated” when Malone “conceded on the record that Pyramid was the liable
employer and agreed to the dismissal of Hyatt from the proceedings.” Id. at
38-39.
Appellants further contend that the trial court should not have dismissed
the Siegel report as speculative because Siegel used terminology sounding in
possibility rather than certainty. Appellants concede that, in his report, Siegel
stated, “[a]lthough it is not certain, in my opinion it is likely that Pyramid would
not have been found to be the responsible party had . . . Malone conducted a
thorough and timely investigation and presented all facts that support that
finding.” Appellants’ Brief at 47 (quoting Siegel Report, 10/14/22, at 8-9).
Appellants maintain that Siegel’s use of the word “likely” was a “typographical
error.” Id.12 Finally, Appellants contend that the Siegel report should not have
been rejected by the trial court as untimely because it was one day late.
12 We note with disapproval that Appellants suggest that “[Siegel] could always
amend his [r]eport to correct that . . . error, should this Court regard that as a necessary step, or simply correct it in his testimony.” Appellants’ Brief at 47. Importantly, this Court may not consider evidence that is not included in the certified record. See Ruspi v. Glatz, 69 A.3d 680, 691 (Pa. Super. 2013). (Footnote Continued Next Page)
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The trial court considered Appellants’ claims regarding the Malone
action and determined that they lacked merit. The court reasoned:
The Siegel Report . . . speculates that, “[a]lthough it is not certain, in my opinion it is likely that Pyramid would not have been found to be the responsible party had Attorney Malone conducted a thorough and timely investigation and presented all facts that support that finding.” The “facts,” . . . are not presented, discussed, or otherwise made a part of the record.
****
[Appellants] failed to offer evidence of an attorney-client relationship between Pyramid and . . . Malone . . . prior to October 2017, after sanctions, vis-a-vis the Yellow Freight motion, had been granted.
[Appellants] failed to provide evidence of proximate cause. The only claim that ORIC could assert is that . . . Malone . . . [was] negligent in agreeing to dismiss Hyatt from the case. Pyramid, however, failed to present any evidence that Hyatt was liable. More specifically, [Appellants] failed to secure [Linnik’s] medical records prior to his last day of work. [Appellants] failed to obtain [Linnik’s] employment from Hyatt.
Trial Court Opinion, 11/15/23, at 15, 17 (footnote omitted).
Viewing the record in the light most favorable to Pyramid, as the
nonmoving party, and resolving all doubts as to the existence of a genuine issue
of material fact against Pyramid, we discern no error of law or abuse of
discretion by the trial court in granting GBS’s motion for summary judgment in
the Malone action. The undisputed evidence established that Malone was not
Consequently, this Court is unable to consider the evidence and testimony that Appellants, in hindsight, wish they had submitted to the trial court rather than the expert report and expert testimony that they did, in fact, submit to the trial court and which is now part of the certified record.
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assigned to defend Pyramid until two months after the Yellow Freight order
had been entered in the Pyramid claim. By that time, Linnik’s claim that he
suffered a cumulative trauma injury over his fourteen-year employment at the
hotel was deemed admitted. Contrary to Appellants’ assertion otherwise, Linnik
was not required to corroborate the allegations in his claim petition, as such
allegations stood on their own as competent evidence. See Heraeus Electro
Nite Co., 697 A.2d at 608. Further, Linnik had produced a paycheck from
Pyramid which encompassed the last ten days of his employment at the hotel
and, more importantly, his date of injury. Thus, by the time Malone was
assigned to defend Pyramid, the undisputed evidence presented in the Pyramid
claim proceedings established that Linnik suffered a cumulative trauma injury
over the course of his employment at the hotel and that Pyramid was solely
responsible for the claim because it was Linnik’s employer on the date of his
injury.
Moreover, the equivocal opinions provided in Dr. Mendez’s report did not
provide a medical defense to the Pyramid claim. While it is true that Dr. Mendez
found no evidence of a traumatic injury while Linnik was employed by Pyramid,
Dr. Mendez also found no evidence of a traumatic injury while Linnik was
employed by Hyatt, let alone any evidence that any injury sustained during his
employment by Pyramid was a mere reccurrence of an injury sustained during
his employment by Hyatt. Simply put, Dr. Mendez provided no medical opinion
that could be used to dispute Linnik’s claim that his disc herniations constituted
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a cumulative trauma injury caused by his fourteen years of banquet serving at
the hotel.
Appellants reliance on the Siegel report to raise an issue of fact to defeat
summary judgment in the Malone action is unavailing. In his report, Siegel
repeatedly posits that, despite the factual and legal obstacles already in place
by the time Malone was assigned to defend Pyramid, Malone should have
conducted a more thorough investigation of Linnik’s claim and, if he had done
so, Malone would have developed a successful defense for Pyramid. See Siegel
Report, 10/14/22, at 7-9.
However, nowhere in his report does Siegel identify any new information
or evidence that: (1) exists; and (2) would have provided a viable defense for
Pyramid. It is not enough to merely postulate that, had Malone conducted a
more thorough investigation, there might have been some additional evidence,
that Malone might have found, which might have been helpful to Pyramid’s
defense. Such speculation is wholly insufficient to create a material issue of
fact to withstand summary judgment. See Myers v. Penn Traffic Co., 606
A.2d 926, 930 (Pa. Super. 1992) (holding that, although the non-moving party
must be given the benefit of all reasonable inferences, that party need not be
given the benefit of inferences not supported by the record or of mere
speculation). Moreover, if there was, in fact, other information or evidence that
Malone could or should have discovered, Appellants were required to disclose
that evidence in opposition to Malone’s motion for summary judgment. Id.
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However, Appellants failed to allege facts which, if proved, could establish that
Pyramid would have prevailed in the Pyramid claim but for Malone’s negligence.
See Myers v. Robert Lewis Seigle, P.C., 51 A.2d at 1185. Based on
Appellants’ failure to identify any issue of material fact in opposition to Malone’s
motion for summary judgment, we discern no error or abuse of discretion by
the trial court in granting summary judgment on all claims asserted in the
Malone action.13
Orders affirmed.
Date: 8/01/2024
13 Although Appellants argue in their final issue that the Siegel Report should
not have been rejected by the trial court as untimely, Appellants fail to direct this Court to the place in the record where the trial court either deemed the report untimely or refused to consider it on this basis. See Pa.R.A.P. 2119(c). Moreover, in its opinion, the trial court considered the Siegel report and evaluated the opinions expressed therein as part of its summary judgment analysis. See Trial Court Opinion, 11/15/23, at 16-17. Thus, as there is no indication that the trial court rejected the Siegel report as untimely, we need not address this claim.
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