Court Opinion

ID: 4170484
Source: CourtListenerOpinion
Date Created: 2017-05-19 17:16:42.265292+00
Date Added: 2024-06-11T07:47:03.370865
License: Public Domain

J-S19002-17

                              2017 PA Super 153

DAVID R. NICHOLSON, BUILDER,            :   IN THE SUPERIOR COURT OF
LLC                                     :        PENNSYLVANIA
                                        :
                  Appellant             :
                                        :
            v.                          :
                                        :
ERIN L. JABLONSKI AND BRANDON           :
M. VOGEL, HUSBAND AND WIFE              :
                                        :
                  Appellees             :         No. 1603 MDA 2016

              Appeal from the Order Entered August 29, 2016
              In the Court of Common Pleas of Union County
                      Civil Division at No(s): 16-0109

BEFORE:    GANTMAN, P.J., BENDER, P.J.E., and STEVENS, P.J.E.*

OPINION BY GANTMAN, P.J.:                             FILED MAY 19, 2017

     Appellant, David R. Nicholson, Builder, LLC, appeals from the order

entered in the Union County Court of Common Pleas, which sustained the

preliminary objections of Appellees, Erin L. Jablonski and Brandon M. Vogel,

struck Appellant’s de novo appeal, and dismissed as untimely Appellant’s

complaint for breach of contract. We affirm.

     The relevant facts and procedural history of this case are as follows.

Appellant is a single-member limited liability company (“LLC”).    David R.

Nicholson, a non-attorney, is the sole member of Appellant. In November

2011, the parties entered into an agreement for Appellees to pay Appellant,

in two installments, an outstanding balance for services Appellant had

provided Appellees.   On November 24, 2015, Mr. Nicholson filed a pro se

complaint on behalf of Appellant before a Magisterial District Judge (“MDJ”)
_____________________________

*Former Justice specially assigned to the Superior Court.
J-S19002-17

against Appellees for Appellees’ alleged failure to perform under the

agreement. The MDJ entered judgment in favor of Appellees on February 3,

2016.

        On February 26, 2016, Mr. Nicholson filed a pro se appeal on behalf of

Appellant in the Union County Court of Common Pleas and a pro se

complaint.    Appellees filed preliminary objections on March 17, 2016.    In

their preliminary objections, Appellees averred: (1) Mr. Nicholson could not

appear in the court of common pleas on behalf of Appellant because he is

not an attorney; and (2) the court did not have jurisdiction over the appeal

because Mr. Nicholson’s pro se filings in the court of common pleas were

legal nullities.   On April 4, 2016, Appellant filed a counseled complaint.

Appellees filed preliminary objections to Appellant’s counseled complaint. In

their second set of preliminary objections, Appellees restated the averments

in their initial preliminary objections and claimed Appellant’s counseled

complaint was out of time.

        Following a hearing, the court sustained Appellees’ preliminary

objections on August 29, 2016, struck Appellant’s appeal, and dismissed

Appellant’s complaint.       Appellant filed a timely notice of appeal on

September      28, 2016, and a voluntary concise        statement of errors

complained of on appeal per Pa.R.A.P. 1925(b).

        Appellant raises three issues for our review:

           WHETHER THE TRIAL COURT ERRED IN [SUSTAINING]
           [APPELLEES]’ PRELIMINARY OBJECTIONS, THUS HOLDING

                                       -2-
J-S19002-17

         THAT A SINGLE-MEMBER [LLC] CANNOT REPRESENT
         ITSELF IN THE COURT OF COMMON PLEAS ON AN APPEAL
         FROM A MAGISTERIAL DISTRICT [COURT]’S RULING?

         WHETHER THE TRIAL COURT ERRED IN [SUSTAINING]
         [APPELLEES]’ PRELIMINARY OBJECTIONS, THUS HOLDING
         THAT THE FILING OF A NOTICE OF APPEAL FROM [A
         MAGISTERIAL      DISTRICT     COURT]     JUDGMENT
         CONSTITUTES PROHIBITED SINGLE-MEMBER LLC SELF-
         REPRESENTATION IN THE COURT OF COMMON PLEAS
         AND, THEREFORE, MUST BE STRICKEN?

         WHETHER THE TRIAL COURT ERRED IN [SUSTAINING]
         [APPELLEES]’ PRELIMINARY OBJECTIONS, THUS HOLDING
         THAT A COMPLAINT FILED BY THE SOLE MEMBER OF A
         SINGLE-MEMBER LLC CANNOT BE CURED BY THE FILING
         OF A COUNSELED AMENDED COMPLAINT?

(Appellant’s Brief at 4).

      Our scope and standard of review in examining a challenge to an order

sustaining preliminary objections are as follows:

         In determining whether the trial court properly sustained
         preliminary objections, the appellate court must examine
         the averments in the complaint, together with the
         documents and exhibits attached thereto, in order to
         evaluate the sufficiency of the facts averred. Clemleddy
         Constr., Inc. v. Yorston, 810 A.2d 693 (Pa.Super.
         2002)[, appeal denied, 573 Pa. 682, 823 A.2d 143
         (2003)]. When sustaining the trial court’s ruling will result
         in the denial of claim or a dismissal of suit, preliminary
         objections will be sustained only where the case is free and
         clear of doubt, and this Court will reverse the trial court’s
         decision regarding preliminary objections only where there
         has been an error of law or abuse of discretion. Id.

Rambo v. Greene, 906 A.2d 1232, 1235 (Pa.Super. 2006).

      In its first and second issues combined, Appellant argues Mr. Nicholson

did not engage in the practice of law when he prepared and filed the pro se

                                     -3-
J-S19002-17

appeal and complaint in the court of common pleas on behalf of Appellant.

Appellant submits Mr. Nicholson properly filed the appeal because he is

Appellant’s sole agent.   Appellant avers Mr. Nicholson should have been

allowed to represent Appellant in the court of common pleas.        Appellant

concludes this Court should vacate the court’s order striking the de novo

appeal and dismissing the complaint, reinstate Appellant’s appeal to the

court of common pleas, and remand for further proceedings on Appellant’s

complaint. We disagree.

      Corporations may appear and be represented in Pennsylvania courts

only by an attorney at law “duly admitted to practice.”      Walacavage v.

Excell 2000, Inc., 480 A.2d 281, 284 (Pa.Super. 1984) (stating: “The

federal courts and the courts of our sister states have consistently held that

a corporation may appear in court only through an attorney at law admitted

to practice before the court”). See also Shortz v. Farrell, 327 Pa. 81, 90,

193 A. 20, 24 (1937) (stating: “In the case of a corporate party…there can

be no legal representation at all except by counsel, because a corporation

cannot appear in propria persona. … Were it otherwise, a corporation could

employ any person, not learned in the law, to represent it in any or all

judicial proceedings”) (internal citations omitted). Some jurisdictions allow

for exceptions to the general rule governing counseled representation of

corporations, for “special small claims courts with informal rules of

procedure in which corporate as well as individual litigants are permitted or

                                    -4-
J-S19002-17

even required to appear without an attorney” and for “stockholder’s

derivative actions.” Walacavage, supra at 284. See also Pa.R.P.C.M.D.J.

207(A)(3) (stating: “In magisterial district court proceedings: …Corporations

or similar entities…may be represented by an attorney at law, by an officer

of the corporation, entity, or association, or by an employee or authorized

agent of the corporation, entity, or association with personal knowledge of

the subject matter of the litigation and written authorization from an officer

of the corporation, entity, or association to appear as its representative”).1

       “The    reasoning     behind     the    general   rule   governing   counseled

representation of corporations is…a corporation can do no act except through

its agents and…such agents representing the corporation in [c]ourt must be

attorneys at law who have been admitted to practice, are officers of the

court and subject to its control. This rule holds even if the corporation has

only one shareholder.”           Walacavage, supra at 284 (internal citations

omitted) (emphasis added).           See also Advanced Telephone Systems,

Inc. v. Com-Net Professional Mobile Radio, LLC, 846 A.2d 1264, 1278

(Pa.Super. 2004), appeal denied, 580 Pa. 687, 859 A.2d 767 (2004)

(stating: “The general rule is that a corporation shall be regarded as an

independent entity even if its stock is owned entirely by one person”). The

____________________________________________

1
  The present case involves Appellant’s pro se representation in a de novo
appeal in the court of common pleas from a magisterial district court
judgment. Accordingly, neither exception applies.

                                           -5-
J-S19002-17

purpose of the rule requiring corporations to appear in court through counsel

“[i]s not the protection of stockholders but the protection of the courts and

the administration of justice, and that a person who accepts the

advantages of incorporation for his…business must also bear the

burdens, including the need to hire counsel to sue or defend in

court.”     Walacavage,          supra   at   284   (internal   quotations   omitted)

(emphasis added).

     Persuasive cases from other jurisdictions hold that an LLC may appear

in court only through counsel because other similar business entities, like

corporations, partnerships, and associations, must be represented by

counsel in court. See, e.g., Harrison v. Wahatoyas, LLC, 253 F.3d 552,

556-57 (10th Cir. 2001); Gilley v. Shoffner, 345 F.Supp.2d 563, 566-67

(M.D.N.C. 2004); Kipp v. Royal & Sun Alliance Personal Ins. Co., 209

F.Supp.2d 962, 962-63 (E.D.Wis. 2002); In re ICLNDS Notes Acquisition,

LLC, 259 B.R. 289, 294 (Bankr.N.D.Ohio 2001); H & H Development, LLC

v. Ramlow, 272 P.3d 657, 661-62 (Mont. 2012); 301 Clifton Place, LLC

v. 301 Clifton Place Condominium Ass’n, 783 N.W.2d 551, 561 (Minn.

Ct. App. 2010); Martinez v. Roscoe, 33 P.3d 887, 889 (N.M. Ct. App.

2001),    cert.   denied,   28    P.3d   1099   (N.M.    2001);    Marina    Condo.

Homeowner’s Ass’n v. Stratford at Marina, LLC, 254 P.3d 827, 834

(Wash. Ct. App. 2011).

     Other jurisdictions hold that an LLC can proceed in court only through

                                         -6-
J-S19002-17

counsel because the LLC corporate form shields LLC members from the LLC’s

liabilities and/or because an LLC is a legal entity distinct from its members.

See, e.g., Michael Reilly Design, Inc. v. Houraney, 835 N.Y.S.2d 640,

641 (N.Y. App. Div. 2007); Disciplinary Counsel v. Kafele, 843 N.E.2d

169, 173-74 (Ohio 2006); Smith v. Rustic Home Builders, LLC, 826

N.W.2d 357, 359-60 (S.D. 2013).

       Additional cases from other jurisdictions hold specifically that a single-

member LLC may proceed in court only through an attorney.                 See, e.g.,

Dougherty v. Snyder, 469 Fed.Appx. 71, 72 (3d Cir. 2012); United

States v. Hagerman, 545 F.3d 579, 581-82 (7th Cir. 2008); Lattanzio v.

COMTA,      481    F.3d    137,    139-40      (2d   Cir.   2007);   Steinhausen   v.

HomeServices of Nebraska, Inc., 857 N.W.2d 816, 825-26 (Neb. 2015);

Dutch Village Mall v. Pelletti, 256 P.3d 1251, 1253-54, (Wash. Ct. App.

2011), review denied, 272 P.3d 246 (Wash. 2012) (stating consistently that

single-member LLC may appear in court only through counsel, because: (1)

LLC is legal entity distinct from its member, and (2) LLC confers on its

member privileges, which carry obligation to hire lawyer to sue or defend on

behalf of LLC).

       The Limited Liability Company Law of 1994 (“LLCL”),2 at 15 Pa.C.S.A.

____________________________________________

2
   The Pennsylvania Uniform Limited Liability Company Act of 2016
(“PULLCA”), 15 Pa.C.S.A. §§ 8811-8898, repealed and replaced the LLCL,
effective as of April 1, 2017.

                                           -7-
J-S19002-17

§§ 8901-8998, governed LLC entities in Pennsylvania before April 1, 2017.

Under the LLCL, the LLC is considered separate and distinct from its

members. See Missett v. Hub. Intern. Pennsylvania, LLC, 6 A.3d 530,

535, 537 (Pa.Super. 2010) (analogizing corporate and LLC forms).3 Section

8922 of the LLCL states:

           § 8922. Liability of members and managers

           (a) General rule.—[T]he members of a limited liability
           company shall not be liable, solely by reason of being a
           member, under an order of a court or in any other manner
           for a debt, obligation or liability of the company of any
           kind or for the acts of any member, manager, agent or
           employee of the company.

15 Pa.C.S.A. § 8922(a).4           In other words, LLC members enjoy limited

____________________________________________

3
 Similarly, Section 8818 of the PULLCA reads: “A limited liability company is
an entity distinct from its member or members.” 15 Pa.C.S.A. § 8818(a).
4
    Section 8834 of the PULLCA similarly states:

           § 8834. Liability of members and managers

           (a) General rule.—A debt, obligation or other liability of a
           limited liability company is solely the debt, obligation or
           other liability of the company. A member or manager is
           not personally liable, directly or indirectly, by way of
           contribution or otherwise, for a debt, obligation or other
           liability of the company solely by reason of being or acting
           as a member or manager.            This subsection applies
           regardless of:

              (1) whether the company has a single member or
              multiple members….

(Footnote Continued Next Page)

                                           -8-
J-S19002-17

responsibility for the debts, obligations, and liabilities of the LLC.             Id.   A

membership interest in an LLC “is an ownership interest…and is akin to an

interest in stock of a corporation.”          Missett, supra at 537.          See also 15

Pa.C.S.A. § 1526(a) (stating stockholder of corporation generally “shall not

be liable, solely by reason of being a shareholder, under an order of a court

or in any other manner for a debt, obligation or liability of the corporation of

any kind or for the acts of any shareholder or representative of the

corporation”). Compare In re Lawrence County Tax Claim Bureau, 998

A.2d   675,      680   n.9    (Pa.Cmwlth.        2010)   (stating   limited    partner   of

Pennsylvania partnership may not represent partnership pro se or in

partnership’s name because limited partner does not share partnership’s

liabilities; however, general partner does have authority to represent

partnership pro se to protect partnership asset).

       Instantly, Mr. Nicholson is the sole member of Appellant, a single-

member LLC. Mr. Nicholson is not an attorney. On behalf of Appellant, Mr.

Nicholson filed pro se in the court of common pleas both an appeal from the

magisterial district court judgment and a complaint.                Appellant’s LLC form

affords Mr. Nicholson advantages. For example, Appellant is a legal entity

distinct   and    separate      from    Mr.      Nicholson.    See     Missett,    supra.
                       _______________________
(Footnote Continued)

15 Pa.C.S.A. § 8834(a)(1).        “The ‘separate entity’ characteristic is
fundamental to a limited liability company and is inextricably connected
to…the liability shield….” 15 Pa.C.S.A. § 8818, Committee Comment, 2016
(internal citation omitted).

                                              -9-
J-S19002-17

Additionally, Mr. Nicholson is not personally responsible for Appellant’s

debts, obligations, and liabilities. See id.; 15 Pa.C.S.A. § 8922(a), supra.

The advantages which Appellant’s form confers on Mr. Nicholson, as a single

member of Appellant LLC, are similar to the advantages of a corporation.

See Advanced Telephone Systems, Inc., supra; Missett, supra. These

advantages obligate Appellant to bear certain corporate burdens, such as the

need to hire counsel to sue or defend in court. See Walacavage, supra.

Thus, the cited persuasive authority leads us to conclude that LLC entities,

generally, may not proceed in Pennsylvania courts of common pleas except

through a licensed attorney. Accordingly, Appellant’s first two issues merit

no relief.

      In its third issue, Appellant argues that even if Mr. Nicholson

erroneously represented Appellant in the court of common pleas, Appellant

cured that defect when it filed a counseled complaint.            Appellant asserts

Appellees suffered no prejudice as a result of Mr. Nicholson filing the notice

of appeal and complaint pro se in the court of common pleas.               Appellant

concludes this Court should vacate the court’s order striking the de novo

appeal and dismissing the complaint, reinstate Appellant’s appeal to the

court of common pleas, and remand for further proceedings on Appellant’s

complaint. We disagree.

      With very few exceptions, the general rule is that non-attorneys are

unable       to   represent   parties   before    Pennsylvania   courts   and   most

                                         - 10 -
J-S19002-17

administrative agencies.        In re Estate of Rowley, 84 A.3d 337, 340

(Pa.Cmwlth. 2013), appeal denied, 626 Pa. 702, 97 A.3d 746 (2014), cert.

denied, ___ U.S. ___, 135 S.Ct. 1720, 191 L.Ed.2d 689 (2015) (affirming

trial court’s decision not to allow non-attorney administrator to represent

estate in action to vacate judicial tax sale of property of estate). In a civil

action, the court lacks jurisdiction to consider the claims raised by non-

attorney.       See,   e.g.,     Spirit     of     the    Avenger       Ministries   v.

Commonwealth, 767 A.2d 1130, 1131 (Pa.Cmwlth. 2001) (holding

appellate court lacked jurisdiction to consider claims, which non-attorney

pastor   made    on    behalf    of   church       in   appeal   from   tax-exemption

determination of agency); McCain v. Curione, 527 A.2d 591, 594

(Pa.Cmwlth. 1987) (holding court lacked jurisdiction to consider pleadings,

which non-attorney filed on behalf of prisoner in civil action).

      Rule 1002 of the Pennsylvania Rules of Civil Procedure of the

Magisterial District Judges, governing appellate proceedings with respect to

judgments and other decisions of the MDJ in civil matters, provides in

pertinent part as follows:

         Rule 1002. Time and Method of Appeal

         A. A party aggrieved by a judgment for money…may
         appeal therefrom within thirty (30) days after the date of
         the entry of the judgment by filing with the prothonotary
         of the court of common pleas a notice of appeal on a form
         which shall be prescribed by the State Court Administrator
         together with a copy of the Notice of Judgment issued by
         the magisterial district judge. The prothonotary shall not
         accept an appeal from an aggrieved party which is

                                          - 11 -
J-S19002-17

        presented for filing more than thirty (30) days after the
        date of entry of the judgment without leave of court and
        upon good cause shown.

Pa.R.C.P.M.D.J. 1002(A). Rule 1004 provides in part:

        Rule 1004. Filing Complaint or Praecipe on Appeal;
        Appeals Involving Cross-Complaints

        A. If the appellant was the claimant in the action before
        the magisterial district judge, he shall file a complaint
        within twenty (20) days after filing his notice of appeal.

Pa.R.C.P.M.D.J. 1004(A). Rule 1006 reads:

        Rule 1006. Striking Appeal

        Upon failure of the appellant to comply with Rule 1004A…,
        the prothonotary shall, upon praecipe of the appellee,
        mark the appeal stricken from the record. The court of
        common pleas may reinstate the appeal upon good cause
        shown.

           Note: This rule is intended to provide sanctions for
           failing to act within the time limits prescribed.

Pa.P.C.P.M.D.J. 1006. Further, Rule 1007 states, in pertinent part:

        Rule 1007. Procedure on Appeal

        A. The proceeding on appeal shall be conducted de novo in
        accordance with the Rules of Civil Procedure that would be
        applicable if the action was initially commenced in the
        court of common pleas.

Pa.R.C.P.M.D.J. 1007(A).

     An appellant from a magisterial district court judgment must perfect

the appeal by filing in the court of common pleas a timely complaint per

Pa.R.C.P.M.D.J. 1004(A). Indep. Tech. Servs. v. Campo’s Exp., Inc., 812

A.2d 1238, 1240 (Pa.Super. 2002).           The appeal is subject to the

                                   - 12 -
J-S19002-17

Pennsylvania Rules of Civil Procedure only after the appellant perfects the

appeal in the court of common pleas. Id.

      Pennsylvania Rule     of Civil Procedure 1028 governs preliminary

objections.     Rule 1028(a) provides that a party may file preliminary

objections in response to a proper pleading.         Pa.R.C.P. 1028(a).      Rule

1028(c)(1) provides in part: “A party may file an amended pleading as of

course within twenty days after service of a copy of preliminary objections.”

Pa.R.C.P. 1028(c)(1). In other words, a party has an opportunity to file an

amended pleading as of right within twenty days of service of preliminary

objections. Lerner v. Lerner, 954 A.2d 1229, 1240 (Pa.Super. 2008).

      Instantly, the MDJ entered judgment in favor of Appellees on February

3, 2016. On February 26, 2016, Mr. Nicholson filed a pro se notice of appeal

in the Union County Court of Common Pleas on behalf of Appellant and a pro

se complaint.    Appellees filed preliminary objections on March 17, 2016,

averring the court lacked jurisdiction over the appeal, because Mr. Nicholson

is not an attorney and his pro se filings in the court of common pleas were

legal nullities. Appellees’ act of filing of preliminary objections to Appellant’s

pro se complaint did not serve to extend the time for Appellant to perfect its

appeal from the MDJ’s judgment, entered on February 3, 2016, by filing an

amended counseled complaint.           Under the rules governing appellate

proceedings with respect to judgments and other decisions of the MDJ in civil

matters, Appellant had thirty days to file a notice of appeal to the court of

                                      - 13 -
J-S19002-17

common pleas and another twenty days from the date of the notice of

appeal to file a counseled complaint in order to perfect its appeal.        See

Pa.R.C.P.M.D.J. 1002(A), 1004(A). Therefore, Appellant had until March 24,

2016, to perfect its appeal.   Appellant did not file its counseled complaint

until April 4, 2016, which was outside the time limits of the relevant

appellate rules.

      Appellees filed preliminary objections to the counseled complaint,

restating their contention that Appellant’s pro se notice of appeal and initial

complaint were legal nullities and maintaining that Appellant’s counseled

complaint was untimely per the applicable rules of court.           Following a

hearing, the court sustained Appellees’ preliminary objections, struck

Appellant’s appeal and dismissed Appellant’s complaint as untimely.

      When the trial court decided Appellant had failed to perfect its appeal

in a timely manner, the court reasoned that Mr. Nicholson was engaged in

the unauthorized practice of law because he: (1) is not an attorney; and (2)

filed a pro se notice of appeal and a pro se complaint in the court of common

pleas on behalf of Appellant, an LLC. (N.T. Preliminary Objections Hearing,

8/29/16, at 12-14). The court determined the pro se complaint was invalid

and struck Appellant’s appeal.     Id.   The court also decided Appellant’s

counseled complaint was outside the pertinent time limits and did not serve

to amend the initial pro se complaint.       Id.   The record supports the trial

court’s ruling.

                                    - 14 -
J-S19002-17

      Here, Mr. Nicholson filed a pro se notice of appeal and complaint on

behalf of Appellant in the court of common pleas within 30 days of the MDJ

judgment.     See Pa.R.C.P.M.D.J. 1002(A), supra.       As a non-attorney,

however, Mr. Nicholson could not represent Appellant in the court of

common pleas.    Thus, the court lacked jurisdiction to consider Appellant’s

initial pro se complaint.   See Spirit of the Avenger Ministries, supra.

Appellant filed its counseled complaint on April 4, 2016, more than 20 days

after the date of its notice of appeal. Consequently, the counseled complaint

was untimely.    See Pa.R.C.P.M.D.J. 1004(A).     Further, Appellant’s initial

complaint could not be “amended” under Rule 1028 of the Pennsylvania

Rules of Civil Procedure because the benefit of Rule 1028 would not be

available to Appellant in this case until after Appellant had properly

perfected its appeal with the filing of a timely counseled complaint.    See

Indep. Tech. Servs., supra.        Therefore, the court of common pleas

properly determined it lacked jurisdiction over Appellant’s appeal because

Appellant failed to perfect its appeal in a timely manner. See id.; Spirit of

the Avenger Ministries, supra.

      Based upon the foregoing, we hold that LLC entities generally must be

represented by a qualified attorney at law in the Pennsylvania courts of

common pleas. Accordingly, we affirm the court’s order striking Appellant’s

appeal and dismissing Appellant’s amended complaint as untimely.

                                   - 15 -
J-S19002-17

     Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 5/19/2017

                          - 16 -