J. A24042/18


NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P. 65.37

ANDREW JOHN KELLY                   :    IN THE SUPERIOR COURT OF
                                    :          PENNSYLVANIA
                v.                  :
                                    :
REPSOL OIL & GAS USA, LLC,          :
AS SUCC. BY CONVERSION TO           :
TALISMAN ENERGY USA, INC.           :
AND NICHOLAS HALKIAS                :
                                    :
                v.                  :
                                    :
PAUL A. KELLY, INDIVIDUALLY AND     :
AS AGENT FOR ANDREW JOHN KELLY      :         No. 420 MDA 2018
                                    :
APPEAL OF: PAUL A. KELLY            :


            Appeal from the Order Entered February 20, 2018,
          in the Court of Common Pleas of Susquehanna County
                     Civil Division at No. 2013-584 CP


ANDREW JOHN KELLY                  :     IN THE SUPERIOR COURT OF
                                   :           PENNSYLVANIA
                 v.                :
                                   :
REPSOL OIL & GAS USA, LLC,         :
AS SUCC. BY CONVERSION TO          :
TALISMAN ENERGY USA, INC.          :
AND NICHOLAS HALKIAS               :
                                   :
                 v.                :
                                   :
PAUL A. KELLY, INDIVIDUALLY AND AS :
AGENT FOR ANDREW JOHN KELLY        :          No. 421 MDA 2018
                                   :
APPEAL OF: ANDREW JOHN KELLY       :


            Appeal from the Order Entered February 20, 2018,
          in the Court of Common Pleas of Susquehanna County
                       Civil Division at No. 2013-584
J. A24042/18


BEFORE: OTT, J., McLAUGHLIN, J., AND FORD ELLIOTT, P.J.E.


MEMORANDUM BY FORD ELLIOTT, P.J.E.:                     FILED: MAY 1, 2019

        Andrew John Kelly and Paul Kelly, individually and in his capacity as

agent for Andrew John Kelly (collectively, “appellants”), appeal1 the order of

the Court of Common Pleas of Susquehanna County that ordered appellants

to pay $50,000 in counsel fees to Talisman Energy USA, Inc. (“appellee”).2

After careful review, we affirm.

        The record reflects the following factual and procedural history:   On

March 29, 2006, James Halkias purchased 431.24 acres of land (“Property”)

in Susquehanna County, Pennsylvania. On June 24, 2007, James Halkias and

his wife, Kerry Halkias, purportedly assigned to Andrew John Kelly 15% of

their interest in any royalties that might come due from any energy company

as a result of oil and gas production on their lands.     On August 7, 2008,

James Halkias and Kerry Halkias entered into an oil and gas lease with

Alta Resources, Inc. (“Alta”).     On September 22, 2010, James Halkias

executed a deed transferring the 431.24-acre parcel to Nicholas Halkias. On

February 16, 2012, WPX Energy, the successor in interest to Alta, assigned its

interest in the oil and gas lease to appellee. Sometime before February 19,

2013, appellee received notice that the Halkias family questioned the validity


1   April 25, 2018, this court consolidated the two appeals sua sponte.

2On December 30, 2016, Talisman was converted into Repsol Oil & Gas USA,
LLC.


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of the assignment to Andrew John Kelly.           Appellee then placed royalty

payments for the Property in suspense.

         On May 8, 2013, Andrew John Kelly filed a complaint against appellee

and sought the payment of unpaid royalties plus interest, filing fees, and costs.

On August 12, 2013, appellee petitioned to interplead Nicholas Halkias as a

party.     The trial court granted the petition on October 28, 2013.          On

December 23, 2013, Nicholas Halkias filed an interpleader complaint against

appellants. The trial court conducted a non-jury trial on January 18-19, 2017.3

During the trial, counsel for appellee requested counsel fees. The trial court

directed appellee to file a petition for counsel fees.

         On or about February 23, 2017, appellee petitioned for counsel fees and

costs pursuant to 42 Pa.C.S.A. § 2503(4). Appellee sought recovery for fees

and costs in the amount of $48,165.80. In an order dated June 12, 2017, and

filed June 19, 2017, the trial court ruled in favor of appellee and against

Andrew John Kelly on Andrew John Kelly’s claims of conversion and

defamation of title against appellee that were set forth in the May 8, 2013

complaint. The trial court determined that appellee satisfied the elements of

42 Pa.C.S.A. § 2503(4) and was entitled to reasonable counsel fees. The trial




3 On June 19, 2017, the trial court ruled in favor of Nicholas Halkias and
determined the assignment was void, that Andrew John Kelly had to repay
any royalties he had received, and that appellee had to pay Nicholas Halkias
the royalties held in suspense. Appellants filed a joint motion for post-trial
relief that the trial court denied on December 6, 2017. Appellants have
appealed to this court at Nos. 37 and 83 MDA 2018.


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court stated that it could not determine the amount of the fees without a

hearing. The trial court held the hearing on November 2, 2017. Appellee

presented evidence that it incurred counsel fees totaling $61,165.51.        On

February 20, 2018, the trial court ordered appellants to pay $50,000 in

counsel fees to appellee.

      Paul Kelly appealed the February 20, 2018 order on March 5, 2018.

Andrew John Kelly appealed on March 6, 2018.           On March 12, 2018, in

two separate orders, the trial court ordered each appellant to file a concise

statement of errors complained of on appeal pursuant to Pa.R.A.P. 1925(b).

Each appellant complied with the order on April 3, 2018. On April 9, 2018,

appellee praeciped to enter judgment in favor of appellee and against

appellants. On April 19, 2018, the trial court issued a statement pursuant to

Pa.R.A.P. 1925(a).

      On appeal, appellants4 raise the following issues for this court’s review:

            [1.]   Did the trial court commit an abuse of discretion
                   and reversible error when it found under
                   42 Pa.C.S.[A.] § 2503(4) [that appellee] had
                   met the requirements of the statute to be
                   awarded attorney’s fees from [appellants] and
                   [o]rdered them to pay one-hundred percent
                   (100%) of [appellee’s] [a]ttorney [f]ees?

            [2.]   Whether the trial court committed an abuse of
                   discretion and reversible error when it awarded
                   an excessive amount of attorney’s fees against
                   [appellants]?


4 Although appellants have filed separate briefs, the issues presented in the
briefs are identical.


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J. A24042/18

Paul Kelly’s brief at 3.

      When reviewing an award of counsel fees, this court employs the

following standard of review:

             Generally, where the award of attorneys' fees is
             authorized by statute, an appellate court reviews the
             propriety of the amount awarded by the trial court
             under an abuse of discretion standard. We will not
             find an abuse of discretion in the award of counsel fees
             “merely because [we] might have reached a different
             conclusion.” Rather, we require a showing of manifest
             unreasonableness, partiality, prejudice, bias, ill-will,
             or such lack of support in the law or record for the
             award to be clearly erroneous. To the extent that the
             issue before us is a question of statutory
             interpretation, however, our scope of review is
             plenary and the standard of review is de novo.

Samuel-Bassett v. Kia Motors Am., Inc., 34 A.3d 1, 51 (Pa. 2011)

(citations omitted).

      Initially, appellants contend that the trial court abused its discretion

when it awarded an excessive amount of attorney’s fees be paid to appellee

by appellants. (Paul A. Kelly’s brief at 7.) Appellants assert that the record

reflects that Jessica Albert, Esq., counsel for appellee, testified that there was

little legal work performed for appellee prior to Nicholas Halkias’ filing his

motion to amend interpleader complaint and that in the petition for fees and

costs, appellee admitted that it did not actively participate in the case. (Id.

at 7-8.) Appellants further argue that there was no real legitimate purpose

for appellee’s counsel to be present at any of the proceedings following the

grant of its petition for interpleader. Essentially, appellants argue that the



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award of counsel fees was an abuse of discretion and an error as a matter of

law because the fees were incurred due to the actions and inactions of appellee

and the fees awarded were unreasonable. (Id. at 9.)

      Appellee was permitted to petition for counsel fees pursuant to

Section 2503(4)    of   the   Judicial   Code,    42   Pa.C.S.A.   §   2503(4).

Section 2503(4) provides:

            The following participants shall be entitled to a
            reasonable counsel fee as part of the taxable costs of
            the matter:

            ....

            (4)    A possessor of property claimed by two or
                   more other persons, if the possessor
                   interpleads the rival claimants, disclaims
                   all interest in the property and disposes of
                   the property as the court may direct.

42 Pa.C.S.A. § 2503(4).

      Appellants do not contest whether appellee interpleaded the rival

claimants and disclaimed all interest in the property. Appellants argue that

42 Pa.C.S.A. § 2503(4) must be read in conjunction with Rule 2307 of the

Pennsylvania Rules of Civil Procedure, which provides as follows:

            (a)    Upon granting a petition for interpleader, the
                   court shall make such order as may be deemed
                   just under the circumstances relating to the
                   payment or delivery into court, or to such
                   person as the court shall direct, of any money
                   or property in controversy disclaimed by the
                   defendant.

            (b)    When the defendant has complied with such
                   order, the court shall enter an order discharging


                                      -6-
J. A24042/18


                    the defendant of all liability to the plaintiff and
                    to any interpleaded claimant who has been
                    served as required by these rules in respect to
                    the money or property so paid or delivered. If
                    the defendant has disclaimed all interest in the
                    action the court in its order shall also discharge
                    the defendant from all liability for any costs
                    accruing after the entry of the order and shall
                    allow the defendant the costs incurred by him
                    or her in the action, to be paid from such money
                    or property in the first instance and taxed as
                    costs in the action.

            (c)     Upon granting the petition for interpleader or at
                    any time thereafter but prior to the final
                    determination thereof the court may make any
                    order relating to the sale or disposition of any
                    property in controversy.

Pa.R.Civ.P. 2307.

      Appellants assert that appellee failed to exercise due diligence in

avoiding unnecessary counsel fees and expenses because it did not seek an

order of court to direct it as to where to pay the funds in controversy.

(Paul A. Kelly’s brief at 13.) However, Rule 2307(a) provides that the court

shall make such order as it may deem just under the circumstances relating

to the payment or delivery into court, or to such person as the court shall

direct, of any money or property in controversy disclaimed by the defendant.

Under the rule, it is in the trial court’s discretion to direct payment into court.

The trial court did not make such an order. From the record, it appears that

appellee was willing to pay the funds into court.             In the petition for

interpleader, appellee stated that it “is able and willing to pay the monies in

controversy as to which it claims no interest into the court or to such person


                                       -7-
J. A24042/18

as the court may direct.” (Petition for interpleader, 8/12/13 at 2.) The trial

court did not order or direct appellee to do so.

      The trial court explained its determination that appellee was entitled to

counsel fees:

            [Appellants] contend the counsel fees [appellee]
            seeks should be denied on the basis that they were
            unreasonably incurred as a result of their own actions.
            The Joint Motion argues that [appellee] should have
            deposited the disputed funds into court, eliminating
            the need for their involvement in the proceedings.
            Indeed, Pa.R.C.P. 2307(a) provides for such a method
            of paying funds into court during an interpleader
            action when directed by a court order. Had this Court
            ordered [appellee] to deposit the funds into court,
            [appellee’s] liability would have been discharged and
            the case moot as to them.

            This Court did not issue an order directing [appellee]
            to turn over the royalty payments to the court.
            Therefore, the case was not moot as to [appellee],
            and the need for their involvement, though limited,
            was not eliminated. [Appellee], without a court order
            directing the deposit of funds, was not discharged of
            liability pursuant to Pa.R.C.P. 2307(b). [Appellee]
            acted reasonably by attending, responding, or
            otherwise participating in relevant parts of the
            interpleader proceedings. Therefore, the Court finds
            [appellee] is entitled to reasonable counsel fees and
            costs pursuant to 42 Pa.C.S.A. § 2503.

Trial court opinion, 2/15/18 at 3.

      This court concludes that the trial court did not abuse its discretion when

it determined that appellee was entitled to an award of counsel fees.

Appellants fail to cite to any rule, statute, or case law that required appellee

to seek an order from the trial court to pay the escrowed funds into court.



                                      -8-
J. A24042/18

      Appellants next contend that the trial court abused its discretion and

committed an error of law because there is nothing in the trial court’s order

or opinion that would justify an award of counsel fees being paid directly by

appellants.

      A review of each appellant’s concise statement of errors complained of

on appeal reveals that neither appellant raised this issue in his concise

statement.    Consequently, this issue is waived.   See Commonwealth v.

Deck, 954 A.2d 603, 610 (Pa.Super. 2008).

      Order affirmed.



Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary

Date: 5/1/2019




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