Court Opinion

ID: 4681305
Source: CourtListenerOpinion
Date Created: 2021-04-27 16:15:03.374024+00
Date Added: 2024-06-11T08:04:00.806382
License: Public Domain

J-A05001-21

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

    MARC ROSENBERG, D.M.D., P.C.,  :             IN THE SUPERIOR COURT OF
    AND MARC ROSENBERG, D.M.D.     :                  PENNSYLVANIA
                                   :
                   Appellant       :
                                   :
                                   :
             v.                    :
                                   :
                                   :             No. 1150 EDA 2020
    NORTH PENN PEDIATRIC DENTAL    :
    ASSOCIATES, LLC; MICHAEL WONG, :
    DDS AND RICHARD J. GALEONE,    :
    DDS

                 Appeal from the Order Entered March 6, 2020
      In the Court of Common Pleas of Philadelphia County Civil Division at
                            No(s): No. 190801032

BEFORE:      OLSON, J., NICHOLS, J., and STEVENS, P.J.E.*

MEMORANDUM BY OLSON, J.:                                 FILED APRIL 27, 2021

        Appellants, Marc Rosenberg, D.M.D., P.C. and Marc Rosenberg, D.M.D.,

(collectively, “Appellants”) appeal from the March 6, 2020 order sustaining, in

part, the preliminary objections filed by North Penn Pediatric Dental

Associates, LLC, Michael Wong, DDS (“Dr. Wong”), and Richard J. Galeone,

DDS (“Dr. Galeone”) (collectively, “Dental Associates”) and dismissing

Appellants’ complaint without prejudice.        The trial court sustained Dental

Associates’ preliminary objections as to venue only and transferred Appellants’

complaint     to   the   Court    of   Common   Pleas   of   Montgomery   County,

Pennsylvania. We affirm, in part, the order as it pertains to sustaining the

preliminary objections and transferring the complaint to the Court of Common
____________________________________________

*   Former Justice specially assigned to the Superior Court.
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Pleas of Montgomery County, and vacate, in part, the order as it pertains to

dismissing the complaint without prejudice.

        The record demonstrates that on August 9, 2019, Appellants filed a

praecipe for writ of summons in the Court of Common Pleas of Philadelphia

County, Pennsylvania.           Appellants subsequently filed a complaint on

November 23, 2019, against Dental Associates for breach of contract (4

counts). Dental Associates filed preliminary objections challenging venue as

improper, to which Appellants filed a response. On March 4, 2020, the trial

court entertained argument on the parties’ respective positions and thereafter

sustained Dental Associates’ preliminary objections on the grounds that venue

in Philadelphia County was improper. The trial court dismissed Appellants’

complaint without prejudice and transferred the matter to the Court of

Common Pleas of Montgomery County. This appeal followed.1

        Appellants raise the following issues for our review:

        [1.]   Did Appellants properly initiate the underlying action in
               Philadelphia County, Pennsylvania where the parties
               consented in writing to venue in Pennsylvania?

        [2.]   Did the trial court commit an error of law in its interpretation
               [or] application of the contractual venue selection clause?

        [3.]   Is venue in Philadelphia County, Pennsylvania reasonable?

Appellants’ Brief at 4.

____________________________________________

1   Both Appellants and the trial court complied with Pa.R.A.P. 1925.

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      In sum, Appellants challenge the trial court’s order sustaining Dental

Associates’ preliminary objections on the grounds that venue in Philadelphia

County was improper. Id. at 14-32.

      Generally, this Court reviews a trial court order sustaining
      preliminary objections based upon improper venue for an abuse
      of discretion or legal error. Further, the construction of a statute
      raises a question of law. On questions of law, our standard of
      review is de novo, and our scope of review is plenary.

Lugo v. Farmers Pride, Inc., 967 A.2d 963, 970 (Pa. Super. 2009) (citations

omitted), appeal denied, 980 A.2d 609 (Pa. 2009).

      A plaintiff's choice of forum is to be given great weight, and the
      burden is on the party challenging the choice to show it was
      improper. However, a plaintiff's choice of venue is not absolute
      or unassailable. Indeed, if there exists any proper basis for the
      trial court's decision to [sustain the preliminary objections and] to
      transfer venue, the decision must stand.

Anthony v. Parx Casino, 190 A.3d 605, 607 (Pa. Super. 2018) (citation and

original brackets omitted). “[T]he presumption in favor of a plaintiff's choice

of forum has no application to the question of whether venue is proper in the

plaintiff's chosen forum; venue either is or is not proper.” Scarlett v. Mason,

89 A.3d 1290, 1293 (Pa. Super. 2014) (citation omitted). The “question of

improper venue is answered by taking a snapshot of the case at the time it is

initiated: if it is ‘proper’ at that time, it remains ‘proper’ throughout the

litigation.” Zappala v. Bandolini Property Management, Inc., 909 A.2d

1272, 1281 (Pa. 2006).

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       Pursuant to Pennsylvania Rule of Civil Procedure 1006(a), an action

against an individual may be brought only in a county in which

       (1) the individual may be served or in which the cause of action
       arose or where a transaction or occurrence took place out of which
       the cause of action arose or in any other county authorized by law,
       or

       (2) the property or a part of the property which is the subject
       matter of the action is located provided that equitable relief is
       sought with respect to the property.

Pa.R.Civ.P. 1006(a)(1) and (2).

       When the action is against a corporation or a similar entity,2 the action

may be brought in:

       (1) the county where its registered office or principal place of
       business is located;

       (2) a county where it regularly conducts business;

       (3) the county where the cause of action arose;

       (4) a county where a transaction or occurrence took place out of
       which the cause of action arose[;] or

       (5) a county where the property or a part of the property which is
       the subject matter of the action is located provided that equitable
       relief is sought with respect to the property.

Pa.R.Civ.P. 2179(a)(1-5); see also Pa.R.Civ.P. 1006(b) (stating, that actions

against corporations or similar entities may be brought only in counties

designated by Rule 2179). If the action seeks to enforce joint or joint and

____________________________________________

2 A limited liability company (LLC) is included within the definition of a
“corporation or similar entity” for purposes of Rule 2179. See Pa.R.Civ.P.
2176.

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several liability against two or more defendants, whether the defendants are

individuals, corporate entities, or a combination of both, the action may be

brought against “all defendants in any county in which the venue may be laid

against any one of the defendants[.]” Pa.R.Civ.P. 1006(c)(1).

      A forum selection clause in a commercial contract “limits the place or

court in which an action may be brought.” Midwest Fin. Acceptance Corp.

v. Lopez, 78 A.3d 614, 628 (Pa. Super. 2013).         Pennsylvania courts have

long held that,

      while private parties may not by contract prevent a court from
      asserting its jurisdiction or change the rules of venue,
      nevertheless, a court in which venue is proper and which has
      jurisdiction should decline to proceed with the cause when the
      parties have freely agreed that litigation shall be conducted in
      another forum and where such agreement is not unreasonable at
      the time of litigation. Such an agreement is unreasonable only
      where its enforcement would, under all circumstances existing at
      the time of litigation, seriously impair plaintiff's ability to pursue
      his cause of action. Mere inconvenience or additional expense is
      not the test of unreasonableness since it may be assumed that
      the plaintiff received under the contract consideration for these
      things. If the agreed upon forum is available to plaintiff and said
      forum can do substantial justice to the cause of action[,] then
      plaintiff should be bound by his agreement. Moreover, the party
      seeking to obviate the agreement has the burden of proving its
      unreasonableness.

Central Contracting Co. v. C.E. Youngdahl & Co., 209 A.2d 810, 816 (Pa.

1965). Forum selection clauses in commercial contracts will be upheld where

those clauses are clear and unambiguous. Patriot Commercial Leasing Co.,

Inc. V. Kremer Restaurant Enters., LLC, 915 A.2d 647, 650 (Pa. Super.

2006), relying on Central Contracting, supra.

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       The venue selection clause at issue in the case sub judice states,

       10.6 Relief – In the event that [Dental Associates] or [Appellants]
       seek judicial enforcement of this agreement, the prevailing parties
       shall be entitled to recover from the other party the reasonable
       attorney’s fees and costs of the [prevailing] party, and both
       parties consent and agree to venue and service [of]
       process in Pennsylvania.

Complaint, 11/23/19, at Exhibit A (emphasis added).3

       Appellants assert that because the venue selection clause in the

agreement designated Pennsylvania as the proper place for venue, the parties

agreed that venue would be proper within any county in Pennsylvania.

Appellants’ Brief at 14-15. Appellants contend that, “[b]y agreeing to venue

in Pennsylvania, the parties waived the right to challenge venue as improper

for a lawsuit filed within the geographic region of Pennsylvania.” Id. at 15.

Appellants argue that the venue selection clause in the instant agreement

“operate[s] as a waiver of objection to venue clause such that the parties

waive the procedural right to object to venue as improper in Pennsylvania.”

Id. at 22. Appellants assert that “[i]mposing [Rule 1006 and Rule 2179] to

overrule [the] contractual venue clause [of the subject agreement] goes

against the [rule of law] set forth [in Central Contracting, supra.]” Id. at

26.

____________________________________________

3 Under the agreement with Dental Associates, Appellants were considered
“an independent contractor providing orthodontic services for [Dental
Associates’] dental practice.” See Complaint, 11/23/19, at ¶18 and Exhibit A.

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     In sustaining Dental Associates’ preliminary objections on the grounds

that venue in Philadelphia County was improper, the trial court stated,

     the parties' forum-selection clause was clear and unambiguous.
     It stated that "both parties consent and agree to venue and
     service [of] process in Pennsylvania." The fact that the parties'
     forum-selection clause did not expressly state: (1) which
     particular county [] is [] proper venue for resolving contractual
     disputes, or (2) which party to the agreement has the right to
     choose which county [] is [] proper venue for resolving contractual
     dispute[s] (as would [be found in] a typical forum-selection
     clause) does not render the forum-selection clause unclear or
     ambiguous.     When there is no such specific language in a
     forum-selection cause [regarding which county is proper venue in
     which to bring a cause of action], courts apply the standard venue
     rules under Pa.R.C[iv].P. 1006[ and Pa.R.Civ.P. 2179].

                                     ...

     [T]he parties only agreed to venue in Pennsylvania. Under [the
     terms of this] forum-selection clause, the trial court recognizes
     that [Dental Associates] cannot challenge through preliminary
     objection[,] or otherwise[,] that venue was not proper in
     Pennsylvania but[,] rather[,] that venue is proper in another
     state.   [However], the parties' forum selection clause does
     not - as urged by [Appellants] - state that the parties agreed that
     venue was appropriate in whatever county [] in Pennsylvania that
     [Appellants] chose to file their complaint. Instead, [] under their
     limited agreement, the standard venue rules under [Rule] 1006[
     and Rule 2179] apply to any other objection to venue by [Dental
     Associates].

Trial Court Opinion, 8/27/20, at 3-4 (extraneous capitalization and footnote

omitted).

     Upon review, we concur with the trial court that pursuant to the

agreement, the parties clearly and unambiguously agreed that Pennsylvania

would be the proper venue for bringing a cause of action stemming from the

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agreement.4 As the trial court noted, the agreement is silent as to the specific

Pennsylvania county, or counties, in which an action may be brought and

whether any party has an absolute right to select the Pennsylvania county in

which to file an action. The parties agreed, however, that the “agreement

shall be governed by and construed in accordance with the laws of the

Commonwealth of Pennsylvania.” See Agreement at §10.5 (Situs). We find

no error of law or abuse of discretion in the trial court’s reliance on Rule 1006

and Rule 2179 to determine that Montgomery County is the proper venue in

which to bring Appellants’ cause of action.5

       The trial court found that, pursuant to Rule 1006, venue was proper in

Montgomery County, and not in Philadelphia County, as to Dr. Wong and Dr.

Galeone because:

       (1) the rules of civil procedure do not allow [Appellants] to serve
       [Dr.] Wong [or Dr.]Galeone in Philadelphia County; (2) the
____________________________________________

4 We find no merit to Appellants’ argument that the parties’ forum-selection
clause limiting proper venue to Pennsylvania constitutes a complete waiver of
all objections to venue. Appellants’ Brief at 22. Provided that Appellants filed
suit within Pennsylvania, we concur with the trial court that, under the express
terms of the parties’ agreement, Dental Associates waived only an objection
to venue on grounds that the suit should have been filed in a state other than
Pennsylvania.

5 When attempting to interpret a contract, a “court may find it necessary to
supply a term which is reasonable under the circumstances to rectify the
parties[’] omissions.” Banks Eng’g Co., Inc. v. Polons, 752 A.2d 883,
886 n.4 (Pa. 2000), citing Restatement (Second) of Contracts § 204 (1979)
and Murray on Contracts § 90. Here, the trial court relied on Rule 1006 and
Rule 2179 in order to “supply” the omitted term of which county constituted
proper venue for Appellants’ cause of action.

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      [breach of contract] cause of action arose in Montgomery County,
      not Philadelphia County; (3) the transaction or occurrence, out of
      which the cause of action arose, took place in Montgomery
      County, not Philadelphia County; (4) the law does not otherwise
      authorize Philadelphia County as a proper venue for [Dr.] Wong
      [or Dr.] Galeone; and (5) the property that is the subject matter
      of the action is located in Montgomery County, not Philadelphia
      County.

Trial Court Opinion, 8/27/20, at 7, citing Appellants’ Complaint at ¶¶46-49.

      The trial court found that, pursuant to Rule 2179, venue was proper in

Montgomery County, and not in Philadelphia County, as to North Penn

Pediatric Dental Associates, LLC because:

      (1) its registered office and principal place of business was located
      in Montgomery County, not Philadelphia County; (2) it did not
      regularly conduct business in Philadelphia County; (3) the [breach
      of contract] cause of action arose in Montgomery County, not
      Philadelphia County; (4) the transaction or occurrence, out of
      which the cause of action arose, took place in Montgomery
      County, not Philadelphia County; [and] (5) the property that is
      the subject matter of the action is located in Montgomery County,
      not Philadelphia County.

Trial Court Opinion, 8/27/20, at 7, citing Affidavit of Darlene Mullen, 12/10/19,

at ¶¶2-4.

      A review of the record demonstrates that in their complaint, Appellants

failed to allege facts which establish that venue, pursuant to Rule 1006, was

proper in Philadelphia County with respect to Dr. Wong and Dr. Galeone.

Neither Dr. Wong nor Dr. Galeone resided in or worked in Philadelphia

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County,6 the cause of action (breach of contract) arose from Appellants’

agreement to work as an independent contractor for Dental Associates’

practice in Montgomery Country, and the events or transactions which led to

the cause of action7 occurred in Montgomery County. Therefore, Montgomery

County is the proper venue within Pennsylvania in which to bring the instant

action against Dr. Wong or Dr. Galeone and, conversely, Philadelphia County

is an improper venue.

       As to North Penn Pediatric Dental Associates, LLC, the record

demonstrates that its principal place of business was in Montgomery County,

it regularly conducted business in Montgomery County,8 and, as discussed

____________________________________________

6 Dr. Galeone resided in and worked in Montgomery County. Dr. Wong resided
in Bucks County, Pennsylvania and worked in Montgomery County.

7 Appellants allege that Dental Associates breached the agreement by, inter
alia, failing to provide Appellants a right of first refusal to purchase a portion
of the dental practice, using the services of other orthodontists at the practice
without seeking Appellants’ approval, and wrongfully terminating the
agreement. See Appellants’ Complaint, 11/23/19, at ¶¶46-54, 64, 74, 83,
92, 101.

8 In determining proper venue pursuant to Rule 2179, courts employ a
“quality-quantity analysis.” Hangey v. Husqvarna Prof’l Prods., Inc., ___
A.3d ___, 2021 WL 855456, at *3 (Pa. Super. Filed March 8, 2021) (slip
opinion) (en banc). “Quality” refers to acts that directly relate to, further, or
are essential to the business objectives of the defendant company and are not
merely incidental acts. Hangey, 2021 WL 855456, *3. To determine if the
defendant company does a sufficient quantity of business in a particular
county, courts should consider the percentage of business derived from that
county as compared to the over-all business. Id.; see also Canter v. Am.
Motor Corp., 231 A.2d 140, 141, 143 (Pa. 1967) (holding, that one to two
per centum of sales, which ranged from $3.7 million to $4.1 million dollars in

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supra, the cause of action, and the events and transactions which gave rise

to Appellants’ breach of contract cause of action, occurred in Montgomery

County. Pursuant to Rule 2179, the proper venue in which to bring a cause

of action against North Penn Pediatric Dental Associates, LLC is Montgomery

County and, conversely, Philadelphia County is an improper venue.

       Appellants aver that venue is nonetheless proper in Philadelphia County

because Dental Associates regularly conducts business in Philadelphia County.

In support of their averment, Appellants allege:

       7.     When [Appellants] performed work for [Dental Associates],
              [Appellants] had ties to Philadelphia County, including
              suppliers such as Orthopli Corporation, which is located in
              Philadelphia, [Pennsylvania].

       8.     [Dental Associates] hired other orthodontists who have
              significant orthodontic practices in Philadelphia County.

       9.     [Other] orthodontists who work at [Dental Associates also
              perform services as] orthodontists at Center City
              Orthodontics, which is located [in Philadelphia County].

Marc Rosenberg Affidavit, 2/27/20, at ¶¶7-9. The averments contained in Dr.

Rosenberg’s affidavit, namely that Appellants purchased supplies from a

business located in Philadelphia County and that other orthodontists, who

____________________________________________

total sales, that were derived from a particular county equated to regularly
conducting business in that county); Monaco v. Montgomery Cab Co., 208
A.2d 252, 256 (Pa. 1965) (holding, that a taxicab company that collected five
to ten per centum of its fairs from persons in a particular county regularly
conducted business in that county); Zampana-Barry v. Donaghue, 921
A.2d 500, 506 (Pa. Super. 2007) (holding, a law firm regularly conducted
business in a county where it performed three to five per centum of its legal
services), appeal denied, 940 A.2d 366 (Pa. 2007).

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performed work on behalf of Dental Associates in Montgomery County, also

performed work as orthodontists for other dental practices located in

Philadelphia County, do not give rise to the quality of business required to

demonstrate    that   Dental   Associates     regularly   conducted   business   in

Philadelphia County. Appellants failed to demonstrate that Dental Associates

performed orthodontic services, which directly related to its business

objectives, in Philadelphia County. Moreover, the record demonstrates that

Dental Associates derived “over 99% of its gross revenues for services

performed in Montgomery County” and of the 12,042 active patients seeking

orthodontic services from Dental Associates, only 25 patients (or less than

0.002% of its active patients’ rooster) were from Philadelphia County. See

Affidavit of Darlene Mullen, 12/10/19, at ¶¶10, 14.          Appellants failed to

demonstrate that Dental Associates performs a quantity of its business in

Philadelphia County sufficient to establish that it regularly conducted business

in Philadelphia County.

      Finally, Appellants argue that Philadelphia County is a reasonable forum

for Appellants to bring a cause of action against Dental Associates. Appellants’

Brief at 29-32. This reasonableness argument is, however, misplaced. Parties

are free to agree contractually to a particular forum and Pennsylvania courts

will enforce that agreement except when, inter alia, that agreement is

unreasonable for the plaintiff. See Central Contracting, 209 A.2d at 816

(holding, that a court must only look at the reasonableness of the forum

selection clause when determining whether to enforce the terms of the

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clause). Here, the parties agreed that Pennsylvania was a proper forum, but

failed to agree specifically as to which county, or counties, within Pennsylvania

the action could be litigated.     Thus, an argument predicated upon the

reasonableness test set forth in Central Contracting, supra, could assert

that Pennsylvania was not a reasonable venue, but that has not occurred in

the case sub judice.    Rather, Appellants agreed that Pennsylvania was a

reasonable venue, and the trial court applied our procedural rules to ascertain

a proper common pleas court within Pennsylvania in which the action could

be brought. The trial court was not required to examine the reasonableness

of Appellants’ selection of Philadelphia County as proper venue because the

parties did not agree to Philadelphia County as the proper venue pursuant to

the terms of the agreement.      Since the agreement was silent as to which

Pennsylvania county, or counties, constituted the proper venue for a dispute

between the parties, we concur with the trial court’s application of a

rule-based analysis to determine proper venue. Because Montgomery County

was determined to be a place of proper venue pursuant to a rule-based

analysis, and not as the result of an enforcement of the terms of the

agreement, the Central Contracting reasonableness test is not necessary.

      In sum, we discern no error of law or abuse of discretion in the trial

court’s order sustaining Dental Associates’ preliminary objections on the basis

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of improper venue and transferring the matter to the Court of Common Pleas

of Montgomery County. 9

       Order affirmed, in part, as it pertains to sustaining the preliminary

objections and transferring the complaint to the Court of Common Pleas of

Montgomery County, and vacated, in part, as it pertains to dismissing the

complaint without prejudice.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 4/27/2021

____________________________________________

9 Pennsylvania Rule of Civil Procedure 1006(e) states that, “[i]f a preliminary
objection to venue is sustained and there is a county of proper venue within
the [Commonwealth of Pennsylvania,] the action shall not be dismissed but
shall be transferred to the appropriate court of that county.” Pa.R.Civ.P.
1006(e). Although a review of the March 6, 2020 order demonstrates that
the trial court’s intent was to transfer this matter to the Court of Common
Pleas of Montgomery County, the trial court erred in dismissing Appellant’s
complaint without prejudice. Id.

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