Court Opinion

ID: 2783087
Source: CourtListenerOpinion
Date Created: 2015-02-27 22:06:28.450359+00
Date Added: 2024-06-11T08:31:32.550067
License: Public Domain

J-A30030-14

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

ABC PEDIATRICS HHC                             IN THE SUPERIOR COURT OF
                                                     PENNSYLVANIA
                         Appellant

                    v.

HEALTH PARTNERS PLANS FORMERLY
KNOWN AS HEALTH PARTNERS
PHILADELPHIA

                         Appellee                   No. 1205 EDA 2014

                 Appeal from the Order Entered April 8, 2014
           In the Court of Common Pleas of Philadelphia County
           Civil Division at No(s): October Term, 2013 No. 02297

BEFORE: MUNDY, J., FITZGERALD, J.*, and PLATT, J.**

MEMORANDUM BY MUNDY, J.:                       FILED FEBRUARY 27, 2015

      Appellant, ABC Pediatrics HHC, appeals from the April 8, 2014 order

granting Appellee, Health Partners Plans’, motion for judgment on the

pleadings on the basis that Appellant’s claims were covered by an earlier

settlement and release agreement entered into between the parties. After

careful review, we affirm.

      The trial court aptly summarized the factual and procedural history of

this case as follows.

            The present action was instituted by plaintiff
            [Appellant] against [] Health Partners Plans [] to
            recover   for    [Appellant’s]  loss   of   business.
            [Appellant] is a licensed home health care company
            that provided medical services to home-confined
            pregnant, postpartum and other infirm patients.
            [Health Partners Plans] is a Pennsylvania based non-
* Former Justice specially assigned to the Superior Court.

** Retired Senior Judge assigned to the Superior Court.
J-A30030-14

          profit health maintenance organization that manages
          the medical care of its “members” through [a]
          network of medical, dental, and mental health care
          providers. On February 3, 2011, [Appellant] and
          [Health Partners Plans] entered into an ancillary
          provider agreement wherein [Health Partners Plans]
          contracted [Appellant] to provide home health care
          services to its members.      The agreement was
          renewed on November 17, 2012.

                In or about January 2013, the parties
          disagreed about the processing and payment of
          certain claims submitted by [Appellant] related to
          [Health Partners Plans’] Well Mom/Well Baby
          Program. During the spring of 2013, the parties
          engaged in discussions and negotiations regarding
          the disputed claims. As a result of the negotiations
          the parties executed a formal Settlement and
          Release Agreement in July 2013. The Settlement
          and Release provided in pertinent part as follows:

               … WHEREAS, the parties disputed either
               formally or informally various matters including
               payment methodologies; and/or payment
               and/or processing of claims with dates of
               service through and including July 15, 2013
               (collectively, the “Disputed Claims”); and/or
               interpretation of contract provision in relation
               to the Disputed Claims; and

               NOW THEREFORE, in consideration of the
               terms and conditions set forth herein, the
               undersigned parties… with intent to be bound
               legally hereby, agree as follows: …

               3. Except as to the obligations created by this
               Agreement, each party and their Successors
               and Assigns, hereby release and forever
               discharge the other party and its respective
               Successors and Assigns, from any all claims,
               suits, causes of action, actions, rights,
               damages, expenses and all consequential
               damages of any kind, whether arising in law or
               equity, in contract or tort, as well as, any claim

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J-A30030-14

                  for attorney’s fees and exemplary and/or
                  punitive damages which are based upon, arise
                  out of, or are connected with, or were raised or
                  could have been raised in connection with the
                  Disputed Claims only. Provider explicitly
                  reserves any other rights available to it
                  pursuant to the provider agreement unrelated
                  to the Disputed Claims.

            On August 5, 2013, [Health Partners Plans] paid to
            [Appellant] the sum of $75,000.00 by bank draft
            which was accepted and deposited by [Appellant].1

                   In October 2013, [Appellant] filed the instant
            action against [Health Partners Plans] seeking
            $2,000,000.00 in breach of contract damages
            alleging that [Health Partners Plans’] failure to pay
            timely the disputed claims in January 2013 breached
            the parties’ provider agreement, and that such
            breach caused plaintiff irreparable harm including in
            particular the destruction of [Appellant’s] business.
            In [Health Partners Plans’] answer and new matter,
            [Health Partners Plans] raised affirmative defenses
            including but not limited to the signed release bars
            [Appellant’s] cause of action and accord and
            satisfaction.   After the pleadings were closed,
            [Health Partners Plans] filed the instant motion for
            judgment on the pleadings.
            _______________________
            1
              [Appellant] alleges in the complaint that on or
            about March 25, 2013, it closed its doors and ceased
            doing business.

Trial Court Opinion, 4/8/14, at 1-2 (footnote in original).

      On April 8, 2014, the trial court issued an order, with an accompanying

opinion, granting Health Partner Plans’ motion for judgment on the

pleadings. The trial court entered judgment in favor of Health Partner Plans

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J-A30030-14

and dismissed Appellant’s complaint.           On April 10, 2014, Appellant filed a

timely notice of appeal.1

       On appeal, Appellant raises the following issue for our review.

              Did the trial court err in dismissing Appellant’s
              complaint through judgment on the pleadings based
              upon a separate release executed in the matter?

Appellant’s Brief at 9.

       Our review of a challenge to a trial court’s grant of judgment on the

pleadings is subject to the following standards.

                    Entry of judgment on the pleadings is
              permitted under Pennsylvania Rule of Civil Procedure
              1034, which provides that “after the pleadings are
              closed, but within such time as not to unreasonably
              delay trial, any party may move for judgment on the
              pleadings.”     Pa.R.C.P. 1034(a).     A motion for
              judgment on the pleadings is similar to a demurrer.
              It may be entered when there are no disputed issues
              of fact and the moving party is entitled to judgment
              as a matter of law.

              Appellate review of an order granting a motion for
              judgment on the pleadings is plenary. The appellate
              court will apply the same standard employed by the
              trial court.      A trial court must confine its
              consideration to the pleadings and relevant
              documents. The court must accept as true all well
              pleaded statements of fact, admissions, and any
              documents properly attached to the pleadings
              presented by the party against whom the motion is
              filed, considering only those facts which were
              specifically admitted.
____________________________________________
1
  The trial court did not order Appellant to file a concise statement of errors
complained of on appeal pursuant to Pennsylvania Rule of Appellate
Procedure 1925. The trial court issued a Rule 1925(a) opinion referencing
its April 8, 2014 opinion as containing the reasons for its ruling.

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            We will affirm the grant of such a motion only when
            the moving party’s right to succeed is certain and the
            case is so free from doubt that the trial would clearly
            be a fruitless exercise.

Southwestern Energy Prod. Co. v. Forest Res. LLC, 83 A.3d 177, 185

(Pa. Super. 2013) (citation omitted), appeal denied, 96 A.3d 1029 (Pa.

2014).

      Instantly, the trial court based its grant of Health Partner Plans’ motion

for judgment on the pleadings on its interpretation of the parties’ settlement

agreement as precluding Appellant’s suit. Trial Court Opinion, 4/8/14, at 3.

                  The enforceability of settlement agreements is
            determined according to principles of contract law.
            Because contract interpretation is a question of law,
            this Court is not bound by the trial court’s
            interpretation.     Our standard of review over
            questions of law is de novo and to the extent
            necessary, the scope of our review is plenary as [the
            appellate] court may review the entire record in
            making its decision.       With respect to factual
            conclusions, we may reverse the trial court only if its
            findings of fact are predicated on an error of law or
            are unsupported by competent evidence in the
            record.

                  The law of this Commonwealth establishes that
            an agreement to settle legal disputes between
            parties is favored. There is a strong judicial policy in
            favor of voluntarily settling lawsuits because it
            reduces the burden on the courts and expedites the
            transfer of money into the hands of a complainant.
            If courts were called on to re-evaluate settlement
            agreements, the judicial policies favoring settlements
            would be deemed useless. …

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                 Where a settlement agreement contains all of
           the requisites for a valid contract, a court must
           enforce the terms of the agreement.

Mastroni-Mucker v. Allstate Ins. Co., 976 A.2d 510, 517-518 (Pa. Super.

2009) (citations omitted).

           In interpreting a contract, the ultimate goal is to
           ascertain and give effect to the intent of the parties
           as reasonably manifested by the language of their
           written agreement. When construing agreements
           involving clear and unambiguous terms, this Court
           need only examine the writing itself to give effect to
           the parties’ understanding.        This Court must
           construe the contract only as written and may not
           modify the plain meaning under the guise of
           interpretation.

Southwestern, supra at 187 (citation omitted).

                With specific reference to what constitutes
           “ambiguity” in the context of contract interpretation,
           our Supreme Court has opined as follows:

                       Contractual language is ambiguous if it is
                 reasonably      susceptible      of    different
                 constructions and capable of being understood
                 in more than one sense. This is not a question
                 to be resolved in a vacuum. Rather,
                 contractual terms are ambiguous if they are
                 subject to more than one reasonable
                 interpretation when applied to a particular set
                 of facts. We will not, however, distort the
                 meaning of the language or resort to a strained
                 contrivance in order to find an ambiguity.

Lenau v. Co-eXprise, Inc., 102 A.3d 423, 430 (Pa. Super. 2014), quoting

Madison Constr. Co. v. Harleysville Mut. Ins. Co., 735 A.2d 100, 106

(Pa. 1999) (internal quotation marks and citations omitted).

                                    -6-
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       Appellant alleges the trial court erred in construing the parties’ July 30,

2013 release as a general release that precluded Appellant’s instant

complaint against Health Partner Plans for loss of business. Appellant’s Brief

at 13. Appellant maintains the release was limited and did not encompass

the claims it raises in the instant complaint. Id. at 12-13

              The crux of the disagreement in this matter is
              whether or not the parties July 15, 2013 settlement
              and release [] was intended to cover and bar
              [Appellant’s] subsequent claim in contract for loss of
              business. A plain reading of the Release reveals the
              parties’ settlement was not a general release. The
              Release was narrowly tailored to cover only the bills
              which Health Partners had failed to pay and was not
              intended to bar a law suit for Health Partners pattern
              and practice of late payments, which late payments
              destroyed [Appellant’s] business.

Id. (citations omitted, emphasis added).2                   Appellant maintains that the

qualifying   language,     “[Appellant]        explicitly   reserves   any   other   rights

available to it pursuant to the provider agreement unrelated to the Disputed

Claims,” contained in Paragraph 3 of the settlement and release agreement

and other references to “Disputed Claims,” means the release was not

____________________________________________
2
  Although referencing a “July 15, 2013” agreement, Appellant actually,
albeit mistakenly, quotes provisions from an unexecuted July 24, 2013 draft
version of the settlement agreement.       However, much of the specific
language that Appellant emphasizes as supporting his argument was either
changed or omitted in the final agreement executed on July 30, 2013.
Compare, Health Partner Plans’ Answer and New Matter, 11/12/13, Exhibit
A - Settlement and Release Agreement (July 30, 2013), with Appellant’s
Answer to Motion for Judgment on the Pleadings, 12/10/13, Exhibit A -
Settlement and Release Agreement (July 24, 2013).

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J-A30030-14

general.   Id. at 14, quoting Health Partner Plans’ Answer and New Matter,

11/12/13, Exhibit A - Settlement and Release Agreement at 2, ¶ 3. Rather,

Appellant argues the term “Disputed Claims” was defined in the settlement

and release agreement as “payment methodologies; and/or processing of

claims with dates of service through and including July 15, 2013.” Id. at 17,

quoting Health Partner Plans’ Answer and New Matter, Exhibit A - Settlement

and Release Agreement at 1. However, Appellant’s quote is incomplete, as

the final version of the settlement and release agreement prefaced that

definition with, “various matters      including payment methodologies….”

Health Partner Plans’ Answer and New Matter, 11/12/13, Exhibit A -

Settlement and Release Agreement at 2, ¶ 3.            Thus, in the following

averment from its complaint against Health Partners Plans, Appellant

maintains its claim falls outside the terms of the release.

            16. The aforestated settlement agreement and
            release disposed of the claims for unpaid bills only.

            17. Because billed revenue was not coming into the
            business on a timely basis, plaintiff was unable to
            pay its fixed expenses ….

Appellant’s Complaint, 10/24/13, at 4, ¶¶ 16, 17.

      The trial court, contrary to Appellant’s implication, did not determine

the release provision in the settlement agreement was a general release.

Rather the trial court concluded, “[t]he claim alleged in [Appellant’s]

complaint falls squarely within the scope of disputed claims as defined by the

                                     -8-
J-A30030-14

Settlement and Release Agreement.” Trial Court Opinion, 4/8/14, at 4. We

agree.

       The settlement and release agreement provides as follows.

              3.     Except as to the obligations created by this
                     Agreement; each party and their Successors
                     and Assigns, hereby release and forever
                     discharge the other party –and its respective
                     Successors and Assigns, from any and all
                     claims, suits, causes of action, actions,
                     rights,   damages,      expenses    and    all
                     consequential damages of any kind,
                     whether arising in law or equity, in
                     contract or tort, as well as, any claim for
                     attorney’s fees and exemplary and/or
                     punitive damages which are based upon,
                     arise out of, or are connected with, or
                     were raised or could have been raised in
                     connection with the Disputed Claims only.
                     Provider explicitly reserves any other rights
                     available to it pursuant to the provider
                     agreement unrelated to the Disputed Claims.

              4.     This Agreement is intended to compromise and
                     settle fully and forever all claims of every
                     kind, character and description of the
                     undersigned parties which were or could
                     have been raised in connection with the
                     Disputed Claims. Nothing in this Agreement
                     shall be construed as an admission of any
                     impropriety or liability on the part of either
                     party.

Health Partner Plans’ Answer and New Matter, 11/12/13, Exhibit A -

Settlement and Release Agreement at 2, ¶¶ 3, 4. (emphasis added).3

____________________________________________
3
 “Consequential damages are generally understood to be other damages
which naturally and proximately flow from the breach of contract.” Cresci
Constr. Servs., Inc. v. Martin, 64 A.3d 254, 264 n.15 (Pa. Super. 2013)
(Footnote Continued Next Page)

                                           -9-
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      Appellant’s claim clearly seeks damages allegedly stemming from

Health Partners Plans’ failure to make payments under the parties’ provider

agreement, which lie squarely within the “Disputed Claims” defined in the

settlement and release agreement. We agree with the trial court that “[t]he

claim for loss of destruction of business or loss of profits is a consequential

damage arising from defendant’s failure to pay the disputed claims.” Trial

Court Opinion, 4/8/14, at 5. We also agree with the trial court that “there is

no ambiguity in the Settlement and Release Agreement.” Id.; see Lenau,

supra. We therefore conclude the trial court did not err in granting Health

Partners Plans’ motion for judgment on the pleadings, because, as a matter

of law, its cause of action was the subject of a valid settlement and release

agreement,     and      Appellant     was    not     entitled   to   any   relief.   See

Southwestern, supra at 185. Accordingly, we affirm the trial court’s April

8, 2014 order granting Health Partners Plans’ judgment on the pleadings and

dismissing Appellant’s complaint.

      Order affirmed.

                       _______________________
(Footnote Continued)
(internal quotation marks and citation omitted).              “Consequential
damages. Losses that do not flow directly and immediately from an
injurious act but that result indirectly from the act.” Black’s Law Dictionary
416 (8th ed. 2004).

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Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 2/27/2015

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