*1
Filed Jan. *2 Wolk, appellants. Philadelphia, Arthur A. Aircraft, ap- Wellington, Philadelphia, Ralph G. pellee. CAVANAUGH, ROWLEY, Judge, and
Before President BECK, McEWEN, CIRILLO, OLSZEWSKI, WIEAND, POPOVICH, KELLY and JJ.
WIEAND, Judge: a Dempsey agreement entered an to settle
Chester The Aircraft against action personal injury pending Cessna (Cessna) County sum of Company Montgomery ($300,000.00) set dollars. After the three hundred thousand how paid, the consideration completed tlement had been ever, had to disclose ascertained that Cessna failed Dempsey discovery may have certain- information which during Therefore, claim. he filеd an action strengthened his Eastern States District Court for the the United alia, that he Pennsylvania alleged, District of which he inter fraud. by had been induced to settle The federal law, Pennsylvania under holding, dismissed the fraud, if Dempsey had affirmed the contract and waived the by offering to disaffirm settlement and to any, failing return the consideration. This decision was affirmed Appeals. Dempsey Third Circuit Court of See: v. Associated Underwriters, (3rd Cir.1992). Aviation Thereaf F.2d 567 ter, County filed a to set Dempsey Montgomery petition grounds aside the on of fraud. Montgomery Court, County response objections, to dis- preliminary judicata.1 From grounds on petition missed review, order, appeal. the instant After careful Dempsey filed we affirm. single injured had been when Cessna C-150
Dempsey filed an action take off. He during aircraft crashed engine sustained, strict injuries alleging to recover for against Cessna warranty.2 This case and breach liability, negligence thousand for the sum of three hundred settled to trial prior learned that ($300,000.00) Dempsey Subsequently, dollars. the aircraft problems of fuel tank with Cessna had been aware during not been disclosed dis- that this information had to settle that he had been induced covery. Contending and, action fraud, after that Dempsey filed the federal dismissed, to set Montgomery County petition had been the settlement. aside Lanuitti,
In Nocito v. for fraud which plaintiff sought to recоver where the action, the in a trespass him to execute a release had induced in favor of the defendant. judgment Court affirmed a Supreme The Court said: fraud, when of this release was procurement
If the
it
had his choice either
disaffirm
Nocito discovered he
to Lanuitti or his insurance
and offer to return
contract
to affirm the
for this release or
carrier the consideration
fraud. Nocito’s failure
contract and waive the
voidable
the al
after he discovered
tender back the consideration
an affir
of the fraud and
fraud constituted a waiver
leged
Harbison,
Pa.
mance of the contract: Walker
*4
(1925)
732;
Finance Co. v.
Funding &
Corporation
A.
[
]
(1919)
215,
264 Pa.
1. As a res In the pleaded as new matter in an answer. See: Pa.R.C.P. however, case, party dispute, and neither has the facts are not in instant objected procedure in the trial court. to the followed parties joined various subsequently as additional defendants 2. Cessna charged the aircraft. with maintenance of who had been 176 law aside pertaining setting
reliance on this state of the of that action for fraud was dismissed Dempsey’s settlements Eastern of by the United States District Court for the District Pennsylvania. judicata subsequent attempt
Was this decision res the the settle- Dempsey to move the state court tо set aside ment? conclude that it was. We that final valid of res holds “[a]
The doctrine competent jurisdiction the a court judgment upon merits of any the or parties privies bars future suit between same their Part the of v. Carlton House on same cause action.” Mintz ners, Ltd., 464, 474, 1240, (1991), Pa.Super. 407 595 A.2d 1245 Silverman, 187, 190, v. 208 A.2d quoting Stevenson denied, 786, (1965), 833, 76, 788 cert. 382 86 15 U.S. S.Ct. (1965). mini of the doctrine “to purpose L.Ed.2d 76 cases, judicial energy mize devoted individual establish certainty respect for court judgments, protect prior adjudication litiga on the from vexatious party relying Ltd., Partners, 474, tion.” Mintz v. Carlton House supra Lebeau, 519, 788, v. 258 Pa.Super. 595 A.2d at Lebeau quoting 480, (1978). 524, 393 A.2d 492 opportunity litigate Where have been afforded an parties comрetent jurisdiction, a claim before court of and where finally controversy, interests court has decided validity of that of parties require of state and actually not be any litigated the claim and issue litigated again. Sulek, 615, 621-622, 5, 422 8 Pa.Super.
Ham v. 620 A.2d (1993). recovery of Regardless plaintiff whether effects a action, may in the first he an action which has relitigate Am.Jur.2d, § 404. adjudicated. Judgments once been of Application judicata requires the doctrine (1) possess the two actions the following common elements: (2) identity thing upon; identity of the sued cause of action; (3) (4) identity identity parties; capacity 255, parties. Stehman, v. Pa.Super. Matternas 261-63, 1120, (1994); McArdle Tronetti allocatur
177
denied,
Valley
Banker v.
622,
(1984);
Pa.
46
Judgments
406
it
primary
has been said that
focus should be whether
issues have been decided. Hammel
controlling
ultimate and
Hammel,
(1994).
v.
230, 238,
214,
431
636 A.2d
218
Pa.Super.
Estates,
Kent,
Hopewell
Inc. v.
471,
Pa.Super.
See also:
435
Mintz v. Carlton House
477,
1192,
(1994);
646 A.2d
1195
Partners, Ltd.,
supra at
In Re Jones &
475,
1247;
Wyoming County, supra identical, or rise to causes of action are giving transactions *6 identity be between two actions may there sufficient judicata res in the judgment in the first action be summary 2d, § Judgments 65:50 second.” 10 Standard Pa.Practice (footnote omitted). action,
In the the issues were whether Cessna had to dis Dempsey sought had information which withheld by the fraud to settle thereby appellant cover and had induced he the petition his state court raised Dempsey’s claim. Thus, in the federal action and complaint same issues. action relied petition upon state both asserted Both also alleged conduct and transaction. actions same i.e., acceptance of an unfavorable injury, appellant’s same evi Finally, upon both actions relied same settlement. allegedly information which was with discovery dence —the necessary to prevail held. In order to in both actions it was actions, moreover, prove fraud. In both the cause of action an affirmance of settlement after the by would be defeated had become known. facts consequence
It is of the federal action was no by and the state action commenced complaint commenced petition agreement. to set aside a settlement The form does whether which two actions are commenced not determine 2d, of are identical. 10 Standard Pa.Practice causes action § Judgments 65:49. of of the doctrine to identical application or depend identity of does not upon
causes
action
A
two
judgment
the forms of the
actions.
differences
upon
a
upon
subsequent
the merits bars
suit
the same
cause,
a
though brought
a different form
cannot,
or
varying
therefore
the form
party
case, escape
a different
his
adopting
рresenting
method
of the
that one and the same cause of
operation
principle
twice litigated.
action shall not be
(footnotes
Am.Jur.2d,
omitted).
§
411
Judgments
Appellant
consequences
also cannot avoid the
prior judicial
merely
altering
determination
character
Silverman,
supra
v.
sought.
relief
See: Stevenson
of the
are a
suffered
Appellant, when discovered which had been supplied during discovery, asserted that he been to claim He then either induced settle his fraud. could offered return the have disaffirmed the settlement and to paid had been or he could have affirmed amount which he In a action to settlement and waived fraud. court held that he had af- recover additional the fraud. decision is firmed the waived That to and bars present, subsequent now and set it aside.4 rescind the settlement Affirmed.
McEWEN, J., a concurríng opinion. files KELLY, CIRILLO, J., opinion files a dissenting which J., joins.
McEWEN, Judge, concurring: my I col- distinguished While commend destination dissent, join journey I who here am unable their leagues in the compelled join majority opinion. and am instead from to individu- jurisprudential property The shift in focus Supreme Court rights triggered al United States II, commenced, of War immediately following decades World Education, course, 483, 74 with Brown v. Board 347 U.S. *8 (1954), in pitch and attained crescendo S.Ct. 98 L.Ed. of sweeping' the 1960s the Court effected enhancement when of the The protection constitutional standards accused. Pennsylvania of in Nocito v. Supreme decision Court (1961) Lanuitti, case which is —the jurispruden- the vortex that shift of appeal preceded of — individual, tial focus Nocito a applied since the appellant's petition 4. Because we hold that to rescind his settlement i.e., judicatа, preclusion, principles of res claim we do not barred arguments petition appellee’s consider additional is also barred i.e., by principles preclusion, estoppel, of collateral issue and doctrine of election of remedies. it held that when upon property focus logic to its legalistic subsequently if one is to of the award compels the return logic even logic loses Legalistic the award. the basis for question individual, as distin- average in for no application, its gloss affluent, preserve is able the vested and from guished as resources to later sufficient garner of an award or proceeds consideration”, precedent the condition to enable a “return of this condi- impose in To reiterated Nocito. to disaffirmance fraud a suit for upon of consideration tion of return precedent for fraud situations, risk of sanction any in most preclude, is to exclaim, would as the advocate negotiations or, in settlement — to deceive and serves as license precedent the condition defraud. Court, constructed lingering inequity, mindful of this
This Briggs Group, v. Erie Ins. that condi- compliance obviated with a rationale which was not fraud action subsequent and found that
tion
the second
judicata,
of res
where
by principles
barred
settle-
negotiated
had ended with
filed after the first action
driver with
ment,
against
the defendant
was instituted
lawsuit,
instead
but
had settled their first
Briggses
whom the
for its inde-
Company
instituted
Erie Insurance
of
the limits
intentionally misrepresenting
tort
pendent
insurance.
policy
of the
liability
applicable
my espousal
the basis for
Having
expressed
hopefully
dissent,
expression
I
proceed
who
goal my colleagues
in the
my colleagues
my joinder
opinion
the basis for
essential
that the
suggestion
with the
majority commencing
—
of the law of disaffirmance
our review is not the state
issue for
proceed-
trial court properly
but whether the
Pennsylvania,
judicata.
of the doctrine of res
ed to
action filed
the United
appellants
Counsel
Distriсt named Associat-
District Court for the Eastern
States
(the
Underwriters,
claims
Lonnie
AAU’s
ed Aviation
Williams
defendants, pre-
Company
Aircraft
as
manager),
misrepresenta-
fraud and
a cause of action based
sented
tion,
damages.
compensatory
punitive
and sought
Court,
of this Court
holding
acknowledging
District
*9
federal court
in its
Briggs,
sitting
diversity
noted that “a
that
of an inter
cannot
assume
the views
jurisdiction
lightly
court,
recent, are a more reliable
appellate
mediate
however
Supreme
Pennsylvania
indicator of how the
Court of
would
present controversy
existing Supreme
than
Court
decide
therefore decline
authority,
vintage....
whatever
its
We
Briggs.”
plaintiffs’
upon
invitation to overrule Nocito based
Underwriters, 141
v. Associated Aviation
F.R.D.
Dempsey
Cir.1992).
(3rd
(E.D.Pa.),
The state trial the learned S. Gerald Corso, correctly further based on the proceedings held that by princi- fraudulent conduct of Cessna were barred allegedly Corso as follows: judicata. Judge of res reasoned ples issues, only claims judicata encompasses “res those or that raised in actually prior proceeding, defenses are have but were but also those which could been raised not. Parks, Authority, Philadelphia Parking E-Z Inc. v. (1987). Pa.Commw. case, has been a there final
Applying foregoing has affirmed on judgment appeal. on the merits which been Industries, Inc., 484 F.2d See: Hubicki v. ACF Cir.1973)____ (3rd case The instant and the second federal “things upon”. causes of action sued action share identical or plaintiff’s April More both actions arose out of specifically, 2, 1988, airplane allege accident and both actions fraudulently by withholding induced plaintiffs critical documents. Although discoverable Nocito, judgment granted 1. While Cessna was in its based on favor judgment federal district court entered favor of Associated Aviation manager any on absence of Underwriters its claims the basis of an legal duty Dempseys. owed Associated Aviation Underwriters Underwriters, Dempsey supra, 141 F.R.D. See: Associated Aviation *10 sought in this action contract recision of seek change action, does not federal in the second (emphasis sup- of action.” cause underlying of the identity plied). dissenting position agree that I with emphasis
It merits
operate
not
action did
negligence
court
the initial state
that
fraud,
for
because
federal action
subsequent
preclude
a
court was based
federal
action commenced
fraud
although
separate
frоm a
arose
cause of
different
remedies.
occurrence,
rise to different
gave
related
judgment,
in a final
resulted
Nonetheless,
federal action
that
Appeals
of
by the Court
appeal
on
was affirmed
which
Aviation Under
v. Associated
Dempsey
See:
Third Circuit.
(3rd
(E.D.Pa.)
writers,
aff'd.,
Pennsylvania of federal courts. judgments are bound state courts 496, 499, Philadelphia, 412 Pa. City See London settlement, and the procurement of the allegation of fraud in the 2. The holding Superior Court apply the inability court to exception noted provides argument Briggs an 336, Troutman, Supreme 502 A.2d Court in Clark v. : (1985) may legal climate warrant intervening change in the relevant "an par- applicable as between of the rule of law reexamination law, change in the or appropriate if the ties .... reexamination is circumstances, in a preclusion would result are such that other laws----” inequitable administration of the manifestly 341, Troutman, quoting A.2d at 139 Restatement supra at Clark v. (c). (Second) § Judgments comment (1963) (once validly acquired federal court 902-03 ancillary all matters extended to jurisdiction, jurisdiction its judicata and it would violate res to the main cause of action court); of state claim state relitigation to permit doctrine 40 Pa.Commw. Pennsylvania, Bardo v. Commonwealth of (1979) (“It 1305, 1307 n. 1 is clear 1,n. subsequent is res that a federal court decision Quite clearly, the Commonwealth proceedings.”). state in the federal court issues litigаted could have they But the state court Scanlon. before presented in 1978— made that decision Having elected not to do so. today is bound reason —the Commonwealth whatever recog- judicata, under res doctrine judgment the federal *11 the federal and the courts both by highest nized systems. Pennsylvania Clean Air Common- Valley Delaware Citizens Council for Cir.1985) (3rd (em- 38, F.2d Pennsylvania, wealth phasis supplied). of the settle- sought could have rescission appellants
Since compensatory their claim for remedy an alternative to ment's fraud, action in the federal based punitive damages and for an action for Briggs permits the issue of whether is an agreement rescissiоn of the settlement fraud without I, into this Court. inquired not now be may issue which majority. therefore, join opinion CIRILLO, dissenting. Judge, 1988, single engine aircraft 2, a Cessna C-150 April On crashed on takeoff. Dempsey operated by appellant Chester his accident, Dempsey Chester appellants Following (the wife, Helen, against filed suit federal court Dempseys) that the accident was caused alleging Cessna appellee filing system. Subsequent in the aircraft’s fuel defects for, 23, 1990, Dempseys moved January instant case on claim. dismissal of their federal voluntary and were a granted, 15, 1990, to a settlement Dempseys agreed On October $300,- Dempseys accepted Cessna. The of all clаims and, return, joint a tortfeasor release executed 000.00 that Thereafter, learned counsel favor of Cessna. relating documents to Cessna’s his had located certain client concerning the installation of a service kit development aircraft. in the fuel tanks the C-150 drains quick additional determining quick these January, In after early discov- responsive to certain may have been drain documents dismissed ery voluntarily requests Dempseys Dempseys. counsel for Cessna notified federal a filed second federal Consequently, Dempseys enter fraudulently them to that Cessna had induced alleging Demp- tortfeasor release. joint into the settlement was for seys’ for relief in this second federal action claim agree- damages; they did not seek rescission of monetary they proceeds. of the settlement ment nor did tender return or, dismiss Cessna filed motion to September On alternative, in the second feder- summary judgment 7, 1992, dated By February al memorandum opinion action. prejudice dismissed with the Honorable Stewart Dalzell in the second action. complaint fraud Dempseys’ decision, his Dalzell the United States rendering Judge Pennsylvania applied District District Court Eastern the settle- that the failure tender Dempseys’ law and held an affirmance of the voidable ment consideration constituted Further, fraud since and a waiver of the сlaim. contract *12 record, his the Dalzell considered information outside Judge judgment against Dempseys the summary order constituted of Civil The 56 of the Federal Rules Procedure. under Rule Court of for Appeals the United States Dempseys appealed which the order. the Third Circuit affirmed the Third were in the Court of for Appeals After briefs filed Circuit, held, Dempseys before oral the argument but petition returned to state court and filed a to set aside release joint Dempseys’ tortfeasor settlement and declare petition null and Dempseys void. The based in upon fraud claim asserted the second the same and release. action and seek rescission of in a motion the nature of preliminary objections Cessna filed 186 trial court sustained petition. and strike the deny 10, February an 1993. by motion order dated
Cessna’s following Dempseys raise timely appeal, their issues: trial court abused its discretion
1. Whether the and/or by failing Briggs error to cite or follow committed reversible 560, 761 594 A.2d Group, v. Erie Insurance damages for fraud which holds that actions are and distinct from separate inducement of a settlement injury? personal actions for Briggs holding trial court erred under 2. Whether the by aside was barred the doctrine of petition that the to set judicata? Briggs holding under the trial court erred Whether the doctrine of by to set aside was barred petitiоn estoppel? collateral Briggs holding trial court erred under
4. Whether the was barred the doctrine of petition that the to set aside election of remedies? sustaining preliminary from an order appeal
Since this is an demurrer, with appear nature of a it must objections that, averred, permit the facts the law will not certainty v. Strassburger, Muhammad recovery by plaintiff. Fioravanti, 541, (1991); v. A.2d 1346 Allstate Ins. Co. Pa. (1973). 585, objections 108, Preliminary 451 Pa. in cases complaint only and a dismissed should be sustained doubt, any from and doubt should be which are clear and free objections. to sustain the Id. resolved refusal Dempseys’ that the claim Instantly, majority has found I judicata. disagree. is barred the doctrine of res requires of the doctrine of res Application (1) identity thing concurrence of four elements: of the sued (3) (2) for; action; identity identity of the cause of of the (4) action; identity persons parties the claim is made. persons for or whom quality Zoning Adjustment, Board City Pittsburgh (1989). case, In the instant it is clear *13 (4) (3) met the the test have been as parts that and the federal a defendant both Dempseys named Cessna as However, an court’s actions. and the state Briggs, supra, decision (1) (2) are res the test parts
reveals that lacking. Briggs, the executors of the estates plaintiffs
In the were collision. died as a result of an automobile two women who Erie, operated the who the vehicle which the insurer of driver accident, with the the initiated settlement discussions caused discussions, plaintiffs the result of these As a plaintiffs. all executed release of general a settlement and entered into from arising the accident. their claims release, per- filed a plaintiffs subsequently Despite against the driver insured Erie injury sonal lawsuit The have the accident. alleged another individual caused and filed motions the defense of release pled defendants plaintiffs pleadings. response, judgment on fraudulently had been obtained that the release asserted misrepresented representative an Erie insurance had because court, The discussions. trial during limits policy perpetrating that were not accused of noting the defendants fraud, preliminary objections the defendants’ granted not tendered plaintiffs on the fact that had based trial On this court affirmed the appeal, settlement proceeds. court’s decision. Erie claiming a lawsuit against next initiated plaintiffs by misrepresenting policy Erie committed fraud
that had In this original settlement discussions. during limits rather than re- plaintiffs sought damages second summary judgment Erie which remedy. as moved scission trial this court vacated granted by Ultimately, court. order, that the of the actions holding the trial court’s dismissal did a second against original preclude the two defendants not сoncurring an In his independent suit for fraud Erie. Brosky wrote: opinion, Judge also suggested present has
Appellee However, judicata. this is barred the doctrine of *14 a Appellant’s liability the case. first action was claim for upon negligent operation based of a motor vehicle. The present action is claim for fraud based settlement ensued after the accident. negotiations which automobile different, only Not are the the nature of the claims parties them, interrelated, although and the facts are supporting Therefore, distinctly different as well. does not bar the action. present 570, at A.2d at 765. Pa.Super. case, in
Similarly,
Dempseys
the instant
havе initiated
In
very
underlying
two different claims with
different
facts.
action,
the state
Dempseys allege negligence,
strict liabili-
ty,
warranty arising
and breach of
from the aircraft accident.
action,
fraud,
Dempseys
the federal
claimed
civil con-
spiracy,
arising
and concerted action
from the defendants’
during
negotiations
conduct
the course of the settlement
and
pretrial negotiations subsequent
other
to the aircraft accident.
Additionally,
sought
the remedies
in the actions are also
action,
dissimilar.
In the
the Dempseys sought
mone-
action,
In the
tary damages
they
for fraud.
state
seek mone-
tary
injury
and rescission of the
personal
in
fully
damages.
Briggs,
settlemеnt
recover these
As
seek rescission of the
although
Dempseys
personal injury
fraud,
change
settlement based on
this does not
the fact the
two
causes of
underlying
actions have different
arise
occurrences,
from different
and seek different remedies. As
such, I
in holding
believe that the trial court erred
that the
Dempseys’
judicata.
claim was barred
the doctrine of res
trial court
found that the
claim
Dempseys’
also
was
estoppel.
estop
barred
the doctrine of collateral
Collateral
pel,
preclusion,
relitigation
the doctrine of issue
forecloses
an issue of fact or law which was
actually litigated
Muhammad,
necessary tо the original judgment.
for fraud was not based
claims
contract,
claims related
solely
upon
but was
based
settlement
negotiations.
settlement
during
to Erie’s conduct
such, this court
on
Further, majority’s I fail to at- repeated understand I that our tempts Briggs. opinion to discount believe great lengths was well reasoned and went to to serve Briggs Further, to the instant justice. Briggs the relevance case undeniable, nearly as the facts and issues both cases are identical. case, has not majority, only the instant discounted *16 but, Briggs, process, it has created an import
unjust
Judge
questionable
Dalzell’s
Beginning
result.
with
Pennsylvania
of relevant
law their federal ac-
application
tion,1
culminating
majority’s
today,
with the
decision
Dalzell,
Dempseys’
Judge
relying
dismissing
In
Lanuitti,
prerequisite to this action. system judicial our to access have been denied Dempseys’ allowed been have such, may As every turn. negotiations during its conduct from benefit to a evidence present be allowed never may Dempsey Mr. I injuries. crippling his caused negligence that Cessna’s jury reprehensible. to be outcome find this I dissent. Accordingly,
KELLY, J., joins. issues facts and Since the A.2d at 763. Pa.Super. at present presented in the Briggs closely mirror those so presented in apply passage would not case, difficulty finding that the above I have Judge to review forum appropriate Obviously, this is not the instantly. however, propriety. decision, question its compelled to I feel Dalzell’s