J-E03002-14


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

LOUIS J. DOMIANO, JR. AND DEBRA                  IN THE SUPERIOR COURT OF
DOMIANO,                                               PENNSYLVANIA

                          Appellants

                     v.

PENN SECURITY BANK, SUCCESSOR BY
MERGER TO OLD FORGE BANK,

                          Appellee                      No. 628 EDA 2013


              Appeal from the Order Entered January 29, 2013
              In the Court of Common Pleas of Monroe County
                    Civil Division at No(s): 2160-CV-2012


LOUIS J. AND DEBRA DOMIANO,                      IN THE SUPERIOR COURT OF
                                                       PENNSYLVANIA
                          Appellants

                     v.

PENN SECURITY BANK, SUCCESSOR BY
MERGER TO OLD FORGE BANK,

                          Appellee                      No. 643 MDA 2013


             Appeal from the Order Entered March 12, 2013
          In the Court of Common Pleas of Lackawanna County
                  Civil Division at No(s): 1703 CV 2012


BEFORE: BENDER, P.J.E., BOWES, PANELLA, DONOHUE, SHOGAN, ALLEN,
        LAZARUS, WECHT, and STABILE, JJ.

MEMORANDUM BY BOWES, J.:                        FILED NOVEMBER 24, 2014

     This is a consolidated appeal by Louis J. and Debra Domiano (“the

Domianos”)    from    orders   sustaining   demurrers    and   dismissing   their
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complaints in two breach of contract/quasi-contract actions that were filed in

actions instituted in two different counties. The actions are identical except

for the real estate collateral located in the respective counties.1 We affirm.

       We discern the following facts from the complaints filed by the

Domianos.       The Domianos were “debtors” in a Chapter 11 bankruptcy

proceeding filed in the United States Bankruptcy Court for the Middle District

of Pennsylvania.       On June 15, 2010, the bankruptcy court approved a

settlement agreement between the Domianos and Penn Security Bank (“the

Bank”), successor by merger to Old Forge Bank; a copy of the agreement

was appended to the complaints.            By its terms, the settlement agreement

imposed several conditions upon the Domianos before any performance

would be required of the Bank.           The Domianos were to provide a written

commitment of financing sufficient to satisfy the remainder of their

obligation to the Bank within sixty days of the date of the settlement

agreement. In addition, within 120 days, the Domianos were obligated to

pay $145,000 to the Bank. If the Domianos fulfilled both conditions, Penn

Security would release a Scranton property from two mortgages, discontinue

a Lackawanna County foreclosure action, and return the consent to entry of

judgment and deed to the Domianos. Failure of the Domianos to tender the

____________________________________________


1
   The parties were represented by the same respective counsel in both the
Monroe County and Lackawanna County actions, which explains the identical
pleadings.



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written commitment within sixty days or pay the property settlement

amount within 120 days constituted default.         Settlement Agreement,

6/15/10, at 3-7.

      The Domianos filed the instant complaints in contract and quasi-

contract against the Bank for breach of the settlement agreement.       They

alleged that they complied with “all material aspects of the agreement and

delivered a mortgage commitment letter to the Defendant.” Complaints, at

¶6.   They averred further that the mortgage commitment letter was

attached to each complaint as Exhibit C. Id. Exhibit C is correspondence

dated August 18, 2010, from E. Robert Blank, President of Penn Business

Credit, LLC., but unsigned by Mr. Blank.   Specifically, the letter sets forth

proposed terms for financing, but the signature line for Mr. Domiano

reflecting that the terms were agreed to and accepted is blank. In addition

to the signature, acceptance required payment of $10,000.       The proposal

expired on August 27, 2010.

      In the Monroe County lawsuit, the Domianos maintained that they had

met the conditions and that the Bank was in breach of the settlement

agreement because it refused to execute and deliver a deed to the Monroe

County property.   They asked the court to order the Bank to execute the

deed and sought damages in excess of $100,000 for lost income from the

non-returned property. Complaint, 4/23/12, at 2.




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      The Bank filed preliminary objections in the nature of a demurrer

pursuant to Pa.R.C.P. 1028(a)(4), and a brief in support thereof, alleging

that the complaints, together with the appended unsigned documents, were

legally insufficient to state a claim for breach of contract or quasi–contract.

The Bank argued that the unexecuted writings relied upon by the Domianos

and their failure to attach a copy of the $10,000 check and the

countersigned letter to the complaint were legally insufficient to establish

that the Domianos had secured a financing commitment from Penn Business

Credit, which was a condition of the settlement agreement.

      The Domianos filed answers to the preliminary objections and asserted

that the Bank was in possession of the signed documents, had acknowledged

same, and that an additional production of the executed documents would

constitute the pleading of evidence.       Answer to Preliminary Objections,

10/12/12, at ¶¶ 7, 11. The Domianos did not amend their complaint as of

right or seek leave to amend their complaint to attach a signed copy or to

plead additional facts to cure any deficiencies.

      Following oral argument on the preliminary objections in Monroe

County, the trial court issued its January 29, 2013 order and opinion

sustaining the Bank’s demurrer and dismissing the Domianos’ complaint with

prejudice. The court found that, even if a copy of the executed letter had

been appended to the complaint, the complaint could not survive a demurrer

since the letter, in order to constitute a commitment, had to be both signed


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by Mr. Domiano and returned with a check for $10,000. The Domianos did

not attach a copy of the check or allege that they had tendered the $10,000

payment to Penn Business Credit.       Furthermore, the letter/proposal was

dated beyond the sixty-day period for performance under the settlement

agreement.

      In the Lackawanna County case, the parties, causes of action, claims,

and requested relief were identical with respect to the collateral involved.

Preliminary objections in the nature of a demurrer were pending in that

action when the Monroe County order sustaining the demurrer was entered.

Therein, the Bank filed a supplemental brief asking the trial court to take

judicial notice of the January 19, 2013 Monroe County order and opinion.

The Lackawanna County court heard oral argument on the preliminary

objections on March 11, 2013, and sustained the demurrer, concluding that

the claims, causes of action, and identities of the parties and their capacities

were identical to those in the Monroe County action, and that the prior

decision constituted res judicata.

      The Domianos timely appealed from both adverse rulings and this

Court, at the request of the Bank, consolidated them. The Domianos raise

three issues for our review:

      I.     Whether the courts below properly considered a demurrer
             which did not raise the issue on which the court based its
             conclusion?

      II.    Whether the courts below properly concluded that no
             cognizable action did exist or could have been pleaded?

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      III.   Whether the courts below improperly refused to permit an
             amended complaint?

Appellants’ brief at 4.

      In reviewing a trial court order overruling or sustaining preliminary

objections, we must

      “determine whether the trial court committed an error of law.
      When considering the appropriateness of a ruling on preliminary
      objections, the appellate court must apply the same standard as
      the trial court.” De Lage Landen Fin. Servs., Inc. v. Urban
      P'ship, LLC, 2006 PA Super 169, 903 A.2d 586, 589 (Pa. Super.
      2006).

             “Preliminary objections in the nature of a demurrer
             test the legal sufficiency of the complaint.” When
             considering preliminary objections, all material facts
             set forth in the challenged pleadings are admitted as
             true, as well as all inferences reasonably deducible
             therefrom. Preliminary objections which seek the
             dismissal of a cause of action should be sustained
             only in cases in which it is clear and free from doubt
             that the pleader will be unable to prove facts legally
             sufficient to establish the right to relief. If any doubt
             exists as to whether a demurrer should be sustained,
             it should be resolved in favor of overruling the
             preliminary objections.

      Hykes v. Hughes, 2003 PA Super 397, 835 A.2d 382, 383 (Pa.Super.
      2003) (citations omitted).

Haun v. Cmty. Health Sys., 14 A.3d 120, 123 (Pa.Super. 2011).

      The Domianos’ arguments pertain to both cases. For convenience, we

will reference the Monroe County pleadings and briefs in addressing them.

At the outset, the Domianos claim that the trial court “sustained an

unasserted demurrer.”      Appellants’ brief at 18.   They allege that the only

basis for relief the Bank asserted in its preliminary objections was a lack of


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capacity to sue, which should have been raised via new matter. Appellants’

brief at 11.

       We find the Domianos’ position to be somewhat disingenuous. In their

brief in opposition to the preliminary objections, they acknowledged that the

Bank was seeking a demurrer and argued that the complaint was legally

sufficient.    See Memorandum of Law of the Plaintiffs in Opposition to the

Preliminary Objections of the Defendant, 12/31/12, at 5-7.             Our review of

the preliminary objections confirms that the Bank articulated that the

Domianos’ complaint was legally insufficient because the allegations,

together with the unexecuted supporting documents, failed to state a claim

for breach of contract or quasi-contract.            Such allegations constitute a

demurrer. While the Bank also asserted a lack of capacity to sue, that was

not the ground upon which relief was afforded. This issue is without merit.

       The Domianos next contend that they alleged in their complaint at

“paragraph 6” that “the fully executed documents had been delivered to the

counsel for the Bank.”        See Appellants’ brief at 10.     We find this to be a

misrepresentation of the averments of the complaint.                  The Domianos

actually   pled   that    they “complied       with all   material   aspects   of the

[settlement] agreement and delivered a mortgage commitment letter to the

Defendant[,]” a copy of which was attached as Exhibit C.2 Exhibit C was a

____________________________________________


2
    The Bank argued below that the Domianos were in default of the
settlement agreement when they received the financing proposal dated
(Footnote Continued Next Page)


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copy of an unexecuted letter from Penn Business Credit setting forth the

terms of a financing proposal.            In order to proceed, Mr. Domiano was

required to sign the letter on the line evidencing acceptance and return the

signed letter with a $10,000 check to Penn Business before August 27,

2010. The Domianos did not attach a copy of the signed letter or the check,

nor offer any explanation in their complaint why they could not do so. See

Pa.R.C.P. 1019.3 Hence, we conclude that the Bank’s preliminary objections

sufficiently pled the basis for a demurrer, i.e., that the allegations of the

complaint and supporting documents were legally insufficient to state a

claim for breach of the settlement agreement.

      In their answer to the preliminary objections, the Domianos asserted

that they had provided copies of the executed proposal to the Bank.

However, the Bank denied this averment in its reply brief.       The Domianos

contend that the trial court, in sustaining the demurrer, impermissibly
                       _______________________
(Footnote Continued)

August 18, 2010, since more than sixty days had elapsed from the June 15,
2010 approval of the settlement agreement by the Bankruptcy Court.
3
   The Domianos assert in their brief to this Court that, “It would be a
needless redundancy to require the Domianos to annex documents long
since in the possession of the Bank and even drafted by the Bank counsel.”
Appellants’ brief at 11.     Although the Domianos do not identify the
documents to which they refer, the only documents alleged to be missing
were an executed copy of Exhibit C, the letter/proposal ostensibly authored
by Mr. Blank of Penn Business Credit, LLC, and a copy of the $10,000 check
required for acceptance. Pa.R.C.P. 1019(i) requires the pleader to attach a
copy of any writing upon which the claim or defense is based, or, if the
writing is not accessible, to so state and provide the reason why it is
inaccessible. The Domianos did not comply with this requirement.



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looked outside the pleadings and credited the Bank’s representation that it

did not have a signed copy of the commitment letter.

     We disagree.     The Monroe County trial court looked solely to the

pleadings and attachments in sustaining the demurrer.     Initially, the court

observed that the letter from Penn Business Credit was dated more than

sixty days after the settlement agreement and agreed with the Bank that the

Domianos were in default of the provision requiring that a financing

commitment be provided to the Bank within sixty days.      Furthermore, the

court concluded that Exhibit C was merely a financing proposal from Penn

Business Credit LLC, not a commitment, and that financing would only “be

provided upon execution of all required loan documents and the payment of

specified fees in connection with your transaction.”    Trial Court Opinion,

1/29/13, at 5 (quoting Exhibit C). The proposal provided further that, if the

Domianos “would like to proceed[,]. . . please countersign this term sheet

where indicated below and return it by overnight mail together with your

check in the amount of $10,000.00” Id. (quoting Exhibit C). Exhibit C was

not signed.

     Furthermore, the court found that even if Exhibit C had been

countersigned by Mr. Domiano, the complaint could not survive the

demurrer. The court agreed with the Bank that, since the Domianos did not

append to the complaint a copy of a check for $10,000, a demurrer was

proper. In short, the Domianos failed to plead facts and supply documents

demonstrating that they had timely secured the financing commitment that

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was one of the conditions precedent to the Bank’s performance under the

settlement agreement. We find no error or abuse of discretion on the part of

the trial court in sustaining the demurrer.

      The Domianos complain on appeal that the trial court should have

permitted them to amend their complaint.           The Bank counters that the

Domianos have waived any right to challenge the trial court’s decision to

sustain the demurrer with prejudice, i.e., without leave to amend, since they

failed to seek leave to amend below.          In addition, the Bank directs our

attention to Stempler v. Frankford Trust Company, 529 A.2d 521

(Pa.Super. 1987), where we held on similar facts that it was not an abuse of

discretion to dismiss the complaint without an opportunity to amend where

an amendment would have been futile.

      We note first that the Domianos were permitted to amend their

complaint as of course within twenty days of the filing of the preliminary

objections, but opted not to do so. See Pa.R.C.P. 1028(c)(1). Furthermore,

the record reveals that the Domianos never filed a motion with the trial court

seeking leave to amend with a proposed amended complaint attached

thereto.   See Pa.R.C.P. 1033.    There is no indication that they asked for

leave to amend at oral argument on the preliminary objections.         In their

brief in opposition to preliminary objections, the Domianos did not even

suggest that they could amend the complaint to cure any alleged

deficiencies.   Instead, the Domianos steadfastly maintained that, “the

complaint adequately sets forth what events took place and beyond

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[that] . . . a copy of the document was annexed to the complaint.”

Memorandum of Law of the Plaintiffs in Opposition to the Preliminary

Objections of the Defendant, 12/31/12, at 4.

      Thus, the Domianos failed to preserve this issue for appeal by

neglecting to raise it in the trial court.    See Pa.R.A.P. 302(a).   However,

waiver aside, they are not entitled to relief.      We recognized in Harley

Davidson Motor Co., Inc. v. Hartman, 442 A.2d 284, 286 (Pa.Super.

1982), that there are cases “where it is clear that amendment is impossible

and where to extend leave to amend would be futile.” The Bank is correct

that, in those instances, it is not an abuse of discretion for the court to

dismiss the complaint upon a demurrer. In re Estate of Luongo, 823 A.2d

942, 969 (Pa.Super. 2003).

      The Monroe County trial court concluded that amendment would have

proved futile because no cause of action for breach of contract or quasi-

contract would lie. Trial Court Opinion, 1/29/13, at 6. The court found it

evident from the face of the complaint that the Domianos did not comply

with the terms and conditions of the settlement agreement by timely

procuring a financing commitment with Penn Business Credit, which was a

condition precedent to the Bank’s performance pursuant to the settlement




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agreement.4      Thus, no action for breach of contract could be maintained

against the Bank. We agree that no amendment could cure this deficiency.

       For the foregoing reasons, we find no error or abuse of discretion on

the part of the Monroe County trial court in sustaining the demurrer and

dismissing the complaint with prejudice. The Domianos do not challenge on

appeal the res judicata effect afforded that decision by the Lackawanna

Court of Common Pleas in the action pending before it, and hence, we affirm

that order as well. See Robinson Coal Co. v. Goodall, 72 A.3d 685, 689

(Pa.Super. 2013) (“Application of the doctrine of res judicata as an absolute

bar to a subsequent action requires that the two actions possess the

following common elements: ‘(1) identity of the thing sued upon; (2)

identity of the cause of action; (3) identity of the parties; (4) identity of the

capacity of the parties.’”).

       Orders affirmed.




____________________________________________


4
   The trial court also noted that the Domianos did not plead that they had
tendered $145,000 to the Bank within 120 days of the date of approval of
the settlement agreement, another condition to the Bank’s performance
under the settlement agreement.



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Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 11/24/2014




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