J-A19038-17

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

NANCY GLASS PRODUCTIONS, INC., : IN THE SUPERIOR COURT OF

: PENNSYLVANIA

Appellant :

:

v. :

:

ERICA ENTERPRISES, INC. AND :

SYSTEM4 OF PHILADELPHIA, LLC AND :

SYSTEM4, LLC, :

:

v. :

:

KEVIN LUKE : No. 3697 EDA 2016

Appeal from the Order entered April 30, 2016

in the Court of Common Pleas of Montgomery County,

Civil Division, No(s): 2013-24995

BEFORE: BENDER, P.J.E., DUBOW and MUSMANNO, JJ.

MEMORANDUM BY MUSMANNO, J.: FILED AUGUST 31, 2017

Nancy Glass Productions, Inc. (“NGP”) appeals from the Order granting 

the Motion for Summary Judgment filed by Erica Enterprises, Inc. (“EEI”) 

and System4 of Philadelphia, LLC and System4, LLC (collectively “the 

Defendants”). We affirm. 

In its Memorandum and Order, the trial court set forth the relevant 

factual and procedural history, which we adopt for the purpose of this 

appeal. See Memorandum and Order, 4/30/16, at 1-2.1 

 

1 Additional defendant, Kevin Luke (“Luke”), was released from the case on 

November 29, 2016, when NGP filed a Motion for discontinuance of the 

matter against him. Luke is not a party to the instant appeal.
J-A19038-17

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On April 22, 2016, the trial court entered an Order granting summary 

judgment in favor of the Defendants. NGP filed a timely Notice of Appeal, 

and a court-ordered Pa.R.A.P. 1925(b) Concise Statement of matters 

complained of on appeal.

On appeal, NGP raises the following issues for our review:

1. Did the trial court erroneously grant summary judgment to 

the [] Defendants on their defense to direct liability for the 

thefts and outrageous misconduct of their cleaning 

employee[,] when a reasonable jury could find that, in the 

exercise of ordinary care, they knew or should have known 

that their employee had an extensive criminal history[,] 

including charges of attempted murder and drug[-]dealing[,] 

that were relevant to both the heightened risk associated with 

inserting an employee into a customer’s premises[,] and to 

the monetary and property damages that [NGP] suffered from 

the employee’s criminal propensities and impulsive, 

outrageous conduct?

2. Did the trial court erroneously grant summary judgment to 

the [] Defendants on their defense to direct liability for 

punitive damages for the thefts and outrageous misconduct

that their employee committed when a reasonable jury could 

find their failure to discover, disclose, and respond to Luke’s 

prior misconduct was reckless, and that the [] Defendants 

subjectively appreciated the risk of harm to which they 

exposed [NGP,] but disregarded that risk due to a conflict 

between their duty to the customers and the desire to land a 

fee-paying franchisee?
J-A19038-17

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Brief for Appellant at 3-4.2

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 will be reversed only where 

it is established that the court committed an error of law or 

abused its discretion.

Summary judgment is appropriate only when the record 

clearly shows that there is no genuine issue of material fact and 

that the moving party is entitled to judgment as a matter of law. 

The reviewing court must view the record in the light most 

favorable to the nonmoving party and resolve all doubts as to 

the existence of a genuine issue of material fact against the 

moving party. Only when the facts are so clear that reasonable 

minds could not differ can a trial court properly enter summary 

judgment.

Hovis v. Sunoco, Inc., 64 A.3d 1078, 1081 (Pa. Super. 2013) (quoting 

Cassel-Hess v. Hoffer, 44 A.3d 80, 84-85 (Pa. Super. 2012)). 

As NGP’s claims are related, we will address them together. In its first 

issue, NGP contends that the Defendants owed a duty to use ordinary care 

to protect NGP from harm by Luke. Brief for Appellant at 33. NGP asserts 

that the Defendants’ “system” was to grant privileged access to its 

franchisees without any reasonable investigation or ordinary care. Id. NGP 

claims that “the dutiful objective of hiring trustworthy cleaners to service 

[EEI’s] customers was undercut by the conflicting motive to sell notional 

 

2

In its brief, NGP attempts to raise an additional issue: that “[t]here is 

evidence on which a reasonable jury could find that [EEI] and System4, LLC 

had sufficient control [over Luke] to establish employer liability.” Brief for 

Appellant at 41-42. However, as this issue was not included in NGP’s 

Statement of the Questions Involved, we decline to address it. See

Pa.R.A.P. 2116 (providing that “[n]o question will be considered unless it is 

stated in the statement of questions involved or is fairly suggested 

thereby.”). 
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franchises to persons willing to pay the [Defendants] for the opportunity to 

work for less than minimum wages.” Id. at 34. NGP contends that “a jury 

could reasonably find that the [Defendants] had every incentive not to 

conduct investigations that might spoil franchise sales.” Id. (emphasis in 

original). NGP asserts that “the very risks that should have been disclosed 

had the [D]efendants exercised ordinary care were realized when Luke, who 

had a long career of crime, stole property from [NGP].” Id. NGP claims that 

EEI did not do any screening when selling a franchise to Luke, did not check 

his references, conducted no background check, and did not ask about his 

criminal history or level of education. Id. at 35; see also id. (noting that 

EEI estimated that its interviews with potential franchisees lasted an hour). 

NGP contends that a jury could reasonably have found that EEI had a duty to

investigate and conduct a background check on Luke, thereby creating a 

genuine question of material fact precluding summary judgment. Id. at 39. 

In its second issue, NGP contends that the Defendants owed a 

heightened duty of care to NGP to hire honest cleaners of trustworthy 

character. Id. at 43. NGP asserts that the Defendants breached that duty 

when they “intentionally and as a matter of settled practice,” did not 

perform a background check on Luke or ask him if he had ever been 

convicted of a crime. Id. at 43-44. NGP claims that, under these facts, a 

jury could find that the Defendants “willfully and recklessly turned a blind 
J-A19038-17

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eye to potential disqualifying information that might have spoiled a franchise 

sale.” Id. at 44. 

In its Memorandum and Order, the trial court addressed NGP’s issues 

and determined that, although reasonable minds could differ as to whether 

Luke was an employee or an independent franchisee, the issue was 

ultimately of no moment because (1) if Luke was found to be an employee, 

employer liability would not attach because Luke’s actions were outside the 

scope of his employment;3and (2) if Luke was a franchisee, then vicarious 

liability would not attach. See Memorandum and Order, 4/30/16, at 3. The 

trial court further reasoned that, interpreting NGP’s claim as one for 

negligent hiring, EEI was not directly liable to NGP because Luke’s “prior 

convictions for aggravated assault and possessing an instrument of crime 

are unakin to theft and inappropriate sexual activity such that it would be 

wrong to impute notice of Luke’s proclivities to engage in such conduct.” Id. 

at 5-6. Viewing the record in the light most favorable to NGP, as the nonmoving party, we agree with the trial court’s determination, which is 

supported by the record and free of legal error. Accordingly, we affirm the 

trial court’s entry of summary judgment in favor of the Defendants. See id. 

at 3, 5-6. 

Order affirmed.

 

3 On appeal, NGP concedes that Luke’s actions were outside the scope of his 

employment. See Brief for Appellant at 41 n.7.
J-A19038-17

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Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 8/31/2017
l 

to a franchise agreement between him and Erica Enterprises. 

("Luke"). As a franchisee, Luke operated a cleaning business under the System4 brand pursuant 

franchises from System4, LLC. Erica Enterprises sold a unit franchise to Defendant Kevin Luke 

System4 of Philadelphia ("Erica Enterprises") is a regional franchisor that purchased System4 

who provide the actual cleaning services to customers. Defendant Erica Enterprises, Inc., d/b/a 

to regional franchisors. The regional franchisors typically sell the franchises to unit franchisees, 

Defendant System4, LLC is a company that sells janitorial franchises across the country 

FACTS 

is warranted. 

claims asserted by Plaintiff, the entry of summary judgment in favor of the Moving Defendants 

finds that the non-moving party has not shown that a genuine issue of material fact exists on the 

d/b/a System4 of Philadelphia and System4, LLC ("Moving Defendants"). Because this court 

Before the Court is a Motion for Summary judgment filed by Erica Enterprises , Inc. 

MEMORANDUM AND ORDER 

. KEVIN LUKE . 

. . 

v. 

. . 

. . 

ERICA ENTERPRISES, INC. d/b/a 

SYSTEM4 OF PIULADELPIUA, 

SYSTEM4, LLC 

. v. . 

. . 

NANCY GLASS PRODUCTIONS, INC. No. 2013-24995 

IN THE COURT OF COMMON PLEAS OF 

MONTGOMERY·COUNTY, PENNSYLVANIA 

CIVIL DIVISION 
2 

I See Section 3, i'lfra. 

movant is entitled to judgment as a matter of law. Pa.RC.P. I 035.2; Davis v. Pennzoil, 264 A.2d 

material fact, when viewed in the light most favorable to the non-moving party, and where the 

Summary judgment may be granted only where the evidence of record creates no issue of 

I. Summary Judgment Standard 

DISCUSSION 

damages, 

Alternatively, Moving Defendants request dismissal only of Plaintiff's claims for punitive 

the instant Motion for Summary Judgment. seeking dismissal of all claims made against them. 

Moreover. Moving Defendants asserts that Luke is obligated to indemnify Moving Defendants 

on the claims asserted against them by Plaintiff. On October 26, 2015, Moving Defendants filed 

an additional defendant, asserting that Luke was solely liable or jointly and severally liable. 

conversion, and punitive damages. On December 13, 2013, Moving Defendants joined Luke as 

responsible for the intentional torts committed by Luke while on the Plaintiff's premises. Against 

Moving Defendants. Plaintiff pled direct negligence, 1 vicarious liability, breach of contract, 

On August 6, 2013, Plaintiff sued Moving Defendants claiming that they were 

occasion but denies any allegations of theft. 

engaged in theft and sexual activity on Plaintiff's property. Luke admits to having sex on one 

would be performed by an independent franchisee, in this case, Luke. 

On or around February 7, 2012. Luke and members of his cleaning crew allegedly 

Kevin Luke, who accepted the account. That agreement provided that the cleaning services 

entered into a contract with Erica Enterprises to provide janitorial services at Plaintiff's office. 

Erica Enterprises offered the cleaning account for Plaintiff's office to franchise to unit franchisee 

In late 2011. Plaintiff Nancy Glass Productions, Inc., a television production company, 

2013-24995-0122 Opinion, Page 3 
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alleged wrongdoing because even if Luke was an employee, Luke's conduct grossly deviated 

This court agrees with Moving Defendants that they are not vicariously liable for Luke's 

b. If Luke Was an Employee of Moving Defendants, His Conduct Fell 

Outside the Scope of His Employment 

will be more fully discussed below. 

vicariously liable because his conduct would have fallen outside the scope of his employment, as 

If, on the other hand, Luke is found to be an employee, then Moving Defendants are still not 

vicariously liable. Drexel v. Union Prescription Centers, Inc .• 582 F.2d 781, 785 (3d Cir.1978). 

ultimately ofno moment. If Luke was an independent franchisee, Moving Defendants are not 

Luke was an employee or an independent franchisee. However, as discussed infra, this issue is 

In regards to the first argument, we find that reasonable minds could differ on whether 

a. Moving Defendants are Not Vicariously Liable for Luke's Actions if Luke 

is Determined to be an Independent Franchisee 

employment, thereby dissolving vicarious liability. 

even if Luke is classified as an employee, his conduct fell outside of the scope of his 

franchisors are not vicariously liable for his conduct. Second, Moving Defendants contend that 

First, Moving Defendants claim that because Luke was an independent franchisee, they as 

l. Plaintiff's Vicarious Liability Claims 

News Co, 674 A.2d I 038 (Pa. 1996). 

Moving Defendants make two arguments in their Motion in regards to vicarious liability. 

pleadings. Accu-Weather, Inc. v. Prospect Comms., Inc. 644 A.2d 1254 (1994); Ertel v. Patriotdemonstrate that there is a genuine issue for trial and may not rest on the avennents set forth in 

in the motion the necessary elements warranting summary judgment, the non-moving party must 

597 (Pa. 1970); Rohrer v. Pope, 918 A.2d 122 (Pa Super. Ct. 2007). After movant has set forth 

2013-24995-0122 Opinion, Page 4 
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700. 

of [minor] had any connection to the kind and nature of his employment as a minister." Id. at 

of sexual abuse of a minor. The court concluded that "(n)othing about [defendant's) sexual abuse 

summary judgment for defendant church on a vicarious liability claim stemming from allegations 

the employer. R.A., 748 A.2d at 699. In that case, the Superior Court affirmed the entry of 

forth in R.A., namely that the offending conduct is actuated, at least in part, by a purpose to serve 

without responsibility or reason. Id. This exception arises out of the third prong of the test set 

exceptions to this factfinding rule when the employee's act was so excessive as to be totally 

employment is typically a question for the jury. Id. However, our courts have carved out 

(Pa. Super. Ct. 1998). The determination of whether a person was acting within the scope of 

criminal acts committed by the employee. Costa v. Roxborough Mem 'I Hosp., 708 A.2d 490, 493 

In certain circumstances, liability of the employer may also extend to intentional or 

serve the employer. R.A. v. First Church of Christ, 748 A.2d 692, 699 (Pa. Super. Ct. 2000). 

and nature that the employee is employed to perform; (2) it occurs substantially within the 

authorized time and space limits of the job; and (3) it is actuated, at least in part, by a purpose to 

1271 (Pa. Super. Ct. 1978). Conduct falls within the scope of employment if: ( l) it is of a kind 

the course of and within the scope of employment. Fitzgerald v. McCutcheon, 410 A.2d 1270, 

an employee that causes injuries to a third party. provided that such acts were committed during 

vicarious liability. 

It is well settled that an employer may be held vicariously liable for the negligent acts of 

from the scope of his employment. Luke's conduct fell so far outside the scope of what he was 

engaged to do that Moving Defendants ace entitled to summary judgment as a matter of law as to 

2013-24995-0122 Opinion, Page 5 
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employer "knew or, in the exercise of ordinary care, should have known of the necessity for 

controlling employees." R.A., 748 A.2d at 697. To establish liability, plaintiff must show that the 

An employer owes a duty to "exercise reasonable care in selecting, supervising and 

hiring. We find no merit in either claim. 

read this Count to include claims for direct liability for negligent supervision and negligent 

(Compl. 173). Even though the Count is couched in "Negligence and Vicarious Liability," we 

supervised their employees or representatives they retained to perform the Cleaning Services." 

In Count IV of the Complaint, Plaintiff avers that System4 of Philadelphia "negligently 

3. Moving Defendants are Not Directly Liable for Negligent Hiring or Negligent 

Supenri!ion 

vicariously liable for damages arising therefrom. 

conduct fell so far afield of his contractual duties that his putative employer cannot be held 

could have been actuated for any purpose other than a purely personal one. Even though the 

alleged malfeasance occurred within the office Luke and his crew were supposed to clean; the 

property and engaged in sexual activity on the job site. Neither of these activities in any way 

was doing nothing in furtherance on in connection with his employer's business." Id 

the factory employee was tasked with performing. Id. at 310. "[Ijn striking the match the servant 

striking of the match for the purpose of lighting a cigarette was sufficiently unrelated to the job 

theory of vicarious liability. Our Supreme Court reversed a verdict for the plaintiff because the 

In the case before us, Luke and/or members of his crew are alleged to have converted 

employee standing nearby struck a match to light a cigarette. Plaintiff sued the factory under a 

Plaintiffs clothing, on which gasoline was accidentally spilled, was ignited after a factory 

conduct was far less egregious. In He" v. Simplex Box Corporation, 198 A. 309 (Pa. 1938), the 

Pennsylvania courts have come to the same conclusion in cases where the offending 

2013-24995-0122 Opinion, Pag¢ 6 
6 

Ins. Co., 559 A.2d 914, 916 (Pa. 1989). 

a showing of'outrageous' conduct on the part of the defendant," Baker v. Pa. Nat'l Mui. Cas. 

Punitive damages are collateral or ancillary to a tort claim and are only recoverable upon 

4. Claims for Punitive Damages Must Fail Because the Underlying Claims Fail 

negligent supervision. 

employee, see supra Section 2. Moving Defendants are not directly liable for negligent hiring or 

Luke's proclivities to engage in such conduct. Accordingly, assuming arguendo that Luke is an 

inappropriate sexual activity such that it would be wrong for the court to impute notice of 

convictions for aggravated assault and possessing an instrument of crime are unakin to theft and 

criminal background. It is admitted that Luke has a criminalbackground, but his prior 

Plaintiff claims that Moving Defendants should not have engaged Luke because of his 

employee would assault a customer, the employer was absolved of direct liability. 

in assaultive behavior. The federal trial court found that because it was not foreseeable that the 

background check, KFC would have had no notice that the employee was predisposed to engage 

for theft, but no convictions for violent crimes. Id. at •1. Even ifKFC had conducted a 

District Court granted summary judgment for KFC in a case arising out of the employee's onthe-job assault of a customer. A basic background check would have uncovered prior convictions 

which a third party may be banned. Coatb v. Jones. 419 A.2d l 249, 1250 (Pa. Super. Ct. 1980). 

In Harris v. KFC US. Properties, Inc; 2012 WL 2327748 (E.D.Pa. 2012) the Eastern 

have known of the propensity of the employee and 2) such employment creates a situation in 

In other words, a plaintiff seeking to recover must show that 1) the employer knew or should 

exercising control of his employee." Dempsey v. Wa/so Bureau, Inc .• 246 A.2d 418, 422 (1968). 

i 

I 

2013-24995-0122 Opinion, Page 7 

I 

i 

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Plaintiffs seek punitive damages against Moving Defendants. However, this claim fails 

because, as discussed above, Moving Defendants are not liable for outrageous conduct. 

CONCLUSION 

Defendants System4, LLC and Erica Enterprises are entitled to summary judgment as a 

matter of law as to vicarious liability arising from the alleged misconduct of Defendant Luke 

and/or his crew. All claims and cross-claims directed to 1) Erica Enterprises, Inc. d/b/a System4 

of Philadelphia and 2) System 4, LLC are dismissed. Plaintiff's case to proceed against Luke as a 

result of the joinder of Luke within the applicable statute of limitations. 

2013-24995-0122 Opinion, Page 8