Court Opinion

ID: 4519016
Source: CourtListenerOpinion
Date Created: 2020-03-24 17:11:11.872497+00
Date Added: 2024-06-11T11:44:21.038301
License: Public Domain

J-S03016-20

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

    ARROWHEAD CONVEYOR                :        IN THE SUPERIOR COURT OF
    CORPORATION AND BUSSE/SJI         :             PENNSYLVANIA
    CORPORATION                       :
                                      :
                   Appellants         :
                                      :
                                      :
              v.                      :
                                      :        No. 309 WDA 2019
                                      :
    GIUSEPPE’S FINER FOODS, INC., ICP :
    GLOBAL HOLDINGS, INC., ICP ASSET :
    MANAGEMENT, INC., AND DENNIS V. :
    RAYBUCK                           :

              Appeal from the Judgment Entered February 1, 2019
       In the Court of Common Pleas of Clearfield County Civil Division at
                          No(s): No. 2006-2159-CD

    ARROWHEAD CONVEYOR                :        IN THE SUPERIOR COURT OF
    CORPORATION AND BUSSE/SJI         :             PENNSYLVANIA
    CORPORATION                       :
                                      :
                                      :
              v.                      :
                                      :
                                      :
    GIUSEPPE’S FINER FOODS, INC., ICP :        No. 351 WDA 2019
    GLOBAL HOLDINGS, INC., ICP ASSET :
    MANAGEMENT, INC. AND DENNIS V. :
    RAYBUCK                           :
                                      :
                   Appellants         :

              Appeal from the Judgment Entered February 1, 2019
       In the Court of Common Pleas of Clearfield County Civil Division at
                            No(s): 2006-2159-CD

BEFORE:      McLAUGHLIN, J., McCAFFERY, J., and PELLEGRINI, J.*

*   Retired Senior Judge assigned to the Superior Court.
J-S03016-20

MEMORANDUM BY McCAFFERY, J.:                          FILED MARCH 24, 2020

      Arrowhead Conveyer Corporation and its affiliate, Busse/SJI Corporation

(Busse) (collectively, Arrowhead), plaintiffs below, appeal at 309 WDA 2019

from the judgment entered against their claim to pierce the corporate veil in

the Clearfield County Court of Common Pleas, following the first portion of a

bifurcated trial. Dennis V. Raybuck (Raybuck), Giuseppe’s Finer Foods, Inc.

(Giuseppe’s), ICP Global Holdings, Inc., and ICP Asset Management, Inc.

(collectively, the Raybuck Entities or Raybuck), the defendants below, cross-

appeal at 351 WDA 2019 from the judgment entered against them, following

a jury trial, in this breach of contract action. We affirm.

      Arrowhead    and   Busse    are   Wisconsin   corporations   that   design,

manufacture, and supply container and material handling equipment.           Mr.

Raybuck was the president of the now-defunct Giuseppe’s, as well as the

remaining two Raybuck Entities. At all relevant times, the Raybuck Entities

were closely-held corporations owned by Raybuck and members of his family,

and controlled by Raybuck.       The Raybuck Entities engaged in the food

importation industry. Giuseppe’s was formed to manufacture food products

using products imported by the other entities. In pursuit of this business, the

Raybuck Entities issued multiple purchase orders totaling approximately $24

million.

      In October of 2004, the Raybuck Entities issued an invitation for bids for

the provision of equipment for the Giuseppe’s facility. On December 29, 2004,

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Arrowhead submitted a proposal to furnish a bulk glass depalletizer, a spray

cooler, a pouch cooler for a base price of $754,900, and additional options for

$228,400. The proposal contained a section entitled “Terms and Conditions

of Equipment Sale,” which stated, in toto:

      2. Acceptance: [Giuseppe’s] acceptance of this proposal is limited
      to the terms and conditions contained herein and excludes any
      different or additional conditions contained in [Giuseppe’s]
      acceptance.    If, for [Giuseppe’s] convenience, [Giuseppe’s]
      regular purchase order forms are used in accepting this proposal
      or in ordering equipment covered by this proposal, Arrowhead
      Conveyor’s acceptance is expressly conditioned upon [Giuseppe’s]
      assent to any additional or different terms and conditions
      contained herein. Any contract made by and between the parties
      is expressly conditioned upon Arrowhead Conveyor’s review and
      approval of [Giuseppe’s] credit.

          A. Equipment Purchase Terms of Payment: The purchase
          prices shall be payable in United States current funds as per
          the terms expressed in this proposal (to be determined by
          Arrowhead Conveyor and communicated to [Giuseppe’s] in
          writing).

          B. Parts & Service and equipment orders less than $15,000
          value Terms of Payment: The purchase price shall be payable
          in United States current funds as follows:

               100% due upon shipment or completion of services

           Amounts due upon shipment shall be due when equipment
           is ready for shipment if [Giuseppe’s] notifies Arrowhead
           Conveyor that [Giuseppe’s] is not ready to receive the
           shipment. Such delayed shipment is subject to storage and
           handling charges and is payable upon presentation of
           invoice. If Arrowhead Conveyor is responsible for installation
           and [Giuseppe’s] delays or interrupts installation, the full
           balance of the purchase price less cost of completion of
           installation shall immediately become due. If installation is
           resumed, [Giuseppe’s] shall reimburse Arrowhead Conveyor
           for any increased costs resulting from such delays. In the
           event [Giuseppe’s] does not satisfy the terms of payment

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            outlined herein, Arrowhead Conveyor reserves the right to
            assess a service charge of 1½% per month on the amount
            due on a pro-rata basis for any partial month on the amount
            due in arrears, provided there is no conflict with local or state
            law.

Arrowhead’s Amended Complaint, 8/7/08, Exh. D, at 24 (incorporated by

reference, Second Amended Complaint of 3/23/09).

      On January 5, 2005, Giuseppe’s accepted Arrowhead’s proposal and

issued a purchase order. The purchase order, for $831,000, confirmed that it

was issued per Arrowhead’s proposal dated December 29, 2004. Through a

change order executed by Giuseppe’s in May of 2005, the total contract price

was increased to $879,600. Arrowhead’s affiliate, Busse, separately entered

into an oral agreement with Giuseppe’s to perform field service work on the

equipment.

      Giuseppe’s began to experience funding shortfalls affecting its ability to

pay vendors.         Raybuck’s bank facilitated a financial restructuring plan

pursuant to which the bank agreed to make a loan conditioned upon creditors

agreeing to a payment plan.       Under the plan, which would supersede any

contractual terms to the contrary, creditors would receive an immediate

payment of 75% of the balance owed them. The final 25% would be secured

with a two-year promissory note at annual interest of 6%. The bank’s plan

was designed to keep vendors engaged with Giuseppe’s while it regained its

financial footing.

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        As part of this negotiation with the bank, Raybuck executed a certificate

on December 21, 2006. The certificate compiled a list of all vendors owed in

excess of $100,000 and was created as part of the debt restructuring. The

certificate created by Raybuck delineated two classifications of vendors –

those with whom no dispute existed as to amount owed, and those with whom

amounts owed were disputed.        Arrowhead and Busse were included in the

undisputed list, where vendors’ claims were acknowledged as valid. Next to

the amounts owed to Arrowhead and Busse, Raybuck wrote “no dispute but

no agreement signed.” In this context, it appears that “no agreement signed”

indicates that Arrowhead and Busse had not agreed to the bank’s proposed

payment and restructuring terms.           Arrowhead, however, rejected the

proposed plan and elected instead to proceed under the terms of its

agreement with Giuseppe’s.

        When Giuseppe’s failed to make payment in response to Arrowhead’s

invoices, Arrowhead commenced this action against the Raybuck Entities by

complaint on December 29, 2006, raising two counts of breach of contract and

one count for piercing the corporate veil. The complaint also sought interest,

fees, and costs under the Contractor and Subcontractor Payment Act 1

(CASPA).     The Raybuck Entities raised counterclaims of breach of contract

(one each for Arrowhead’s contract and Busse’s oral agreement), breach of

1   73 P.S. §§ 501-516.

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express warranty, breach of implied warranty of merchantability, and breach

of implied warranty of fitness for a particular purpose.        Raybuck Entities’

Answer, New Matter, & Counterclaims to Second Amended Complaint,

8/20/19. We note that ultimately, Giuseppe’s ceased business and is now

defunct.

      The Honorable Stewart Kurtz, Senior Judge of Huntingdon County, held

a bifurcated bench trial on Arrowhead’s veil-piercing claim on March 2 to 4,

2016. On June 7, 2017, he entered an order dismissing that claim and a

memorandum explaining his ruling. 2

2 Initially, this Court noted a lack of clarity as to whether Arrowhead filed post-
trial motions following the timely entry of the verdict. On March 12, 2019,
this Court issued a rule to show cause directing Arrowhead, appellant in 309
WDA 2019, to show cause why the appeal should not be dismissed. On March
14, this Court received Arrowhead’s letter explaining that lead counsel was on
vacation when the order of judgment from the trial court was received.
Counsel further explained he prepared a motion for post-trial relief remotely
during his vacation, and emailed the motion to the trial court on June 15,
2017, within eight days of the trial court’s order filed on June 7, 2017. Counsel
also instructed his office to send the motion via UPS next day delivery to the
Court of Common Pleas of Clearfield County. The motion was delivered on
June 16, 2017. The Court of Common Pleas’ Prothonotary notified counsel’s
office it was dissatisfied with the electronic signature and requested a
physically signed motion. Another attorney from counsel’s law office entered
her appearance and prepared a physically signed version of the motion, which
was sent overnight and received by the Court of Common Pleas on Monday,
June 19, 2017. On March 26, 2019, this Court entered an order discharging
the rule to show cause.

      Under Pa.R.Civ.P. 227.1(c), post-trial motions must be filed within ten
days.   In this case, the tenth day was Saturday, June 17, 2017.
Unquestionably, the electronically-signed motion, delivered on Friday, June
16th, met this deadline. Per Pa.R.Civ.P 106, periods of time in rules shall be
so computed as to exclude the first and include the last day of such period,
and whenever the last day of such period falls on a Saturday, Sunday, or legal

                                       -6-
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      On May 1, 2018, over eleven years after the commencement of this suit,

the Honorable David Grine, Senior Judge of Centre County, presided over a

jury trial on Arrowhead’s breach of contract claims and the Raybuck Entities’

counterclaims. Pertinently, he granted Arrowhead’s motion to exclude certain

evidence the Raybuck Entities sought to offer as to alleged defects with the

equipment and services supplied by Arrowhead. On May 2, the jury returned

a verdict in favor of Arrowhead. On September 11, 2018, the court entered

an order applying CASPA and awarding a total amount of $844,686.98 to

Arrowhead on all counts.3 On February 1, 2019, the court denied Raybuck’s

motion for post-trial relief and ordered that judgment be entered in favor of

Arrowhead on the breach claims and all of Raybuck’s counterclaims, and in

favor of Raybuck as to piercing the corporate veil.

      Arrowhead filed a timely notice of appeal on February 25, 2019, and

Raybuck filed one on March 1st. On March 26th, this Court consolidated the

appeals. The trial court ordered statements per Pa.R.A.P. 1925(b), and both

parties timely filed such statements. On June 19 and July 17 of 2019, each

trial judge filed a letter advising the Prothonotary he would submit no further

opinion.

holiday, such day shall be omitted from the computation. Thus, the physically-
signed motion, received by the court on Monday, June 19th, also met the
deadline imposed by Rule 227.1.
3 The CASPA ruling affected the rate of interest to be applied to the judgment

for breach.

                                     -7-
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      We first consider Raybuck’s cross-appeal. Raybuck presents five issues

for our review (reordered for ease of discussion):

             Whether the trial court erred in precluding [Raybuck] from
      offering evidence of substantial defects in the equipment and
      services provided by [Arrowhead] as a counterclaim, as a defense,
      and in determining whether [Arrowhead] established a prima facie
      case of [its] proper performance of the contracts and satisfaction
      of all conditions precedent to [Raybuck’s] payment obligations.

            Whether the trial court erred in refusing to issue a curative
      instruction after counsel for [Arrowhead] made a highly prejudicial
      and improper statement, telling the jury that [Raybuck] never
      made any complaints, despite knowing that [Raybuck] repeatedly
      complained and would have offered evidence of such complaints
      and the substantial defects in the equipment but for the trial
      court’s preclusion of such evidence.

            Whether the trial court erred in permitting [Busse] to
      change its claim from an oral contract claim to written contract
      claim when the cause of action pled in Count II of the Second
      Amended Complaint expressly alleged an oral contract between
      [Giuseppe’s] and [Busse], and when the email that allegedly
      formed the basis of a written contract was not attached to the
      Second Amended Complaint.

            Whether the trial court erred in issuing its Finding of Fact
      No. 2, finding that Section 2.B of the written contract between
      [Giuseppe’s] and [Arrowhead] was applicable when the plain
      language of Section 2.B states that Section 2.B is only applicable
      to “Parts & Services and equipment order less than $15,000 value”
      and when it is undisputed that the order in question substantially
      exceeded $15,000 in value.

             Whether the trial court erred in determining that [CASPA]
      was applicable to [Arrowhead] when it did not qualify as a
      “Contractor” under the Act because it was not contracted to
      improve real property, it was only contracted to supply and not
      install equipment.

Raybuck’s Brief at xi-xiii.

                                     -8-
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                      Arrowhead’s Motion in Limine

      First, Raybuck argues the trial court erred in granting Arrowhead’s

motion in limine and precluding proffered evidence of alleged defects in

equipment and services Arrowhead provided, which Raybuck offered as a

counterclaim and a defense. Raybuck claims as follows:

      This Court should reverse and remand for a new trial as to Phase
      II only because the trial court erred in refusing to allow [Raybuck]
      to present evidence that the [e]quipment (the depalletizer, spray
      cooler and TUCS pouch cooler provided by Arrowhead) was
      defective and that the services provided by [Busse] were
      defective.

Raybuck Entities’ Brief at 43-44 (footnote omitted).

      “The question of whether evidence is admissible is a determination that

rests within the sound discretion of the trial court and will not be reversed on

appeal absent a showing that the court clearly abused its discretion.”

Moroney v. General Motors Corp., 850 A.2d 629, 632 (Pa. Super. 2004).

“Discretion is abused when the course pursued represents not merely an error

of judgment, but where the judgment is manifestly unreasonable or where the

law is not applied or where the record shows that the action is a result of

partiality, prejudice, bias or ill will.” Schmalz v. Manufacturers & Traders

Tr. Co., 67 A.3d 800, 803 (Pa. Super. 2013), quoting Catlin v. Hamburg, 56
A.3d 914, 922 (Pa. Super. 2012).

      Preliminarily, we note that while the trial record indicates that oral

argument was scheduled on Arrowhead’s motion in limine, and that the trial

court granted this motion, we have found no indication of the court’s reasoning

                                     -9-
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for its ruling.   Nevertheless, we note Arrowhead’s motion in limine cited

Raybuck’s certification to the bank, signed and executed by Mr. Raybuck as

president of Giuseppe’s, as proof that it did not dispute that Arrowhead was

properly owed the amounts still outstanding under their agreement.         The

motion also sought to exclude evidence of problems with the production line

due to programming errors or deficiencies caused by parties other than

Arrowhead. The reasoning of Arrowhead’s motion, on its own, was sufficient

to demonstrate that the trial court’s ruling was not an abuse of discretion. If

Raybuck had already acknowledged that the remaining balance was properly

owed, the trial court could preclude evidence claiming, belatedly, that

Arrowhead had not satisfied conditions precedent to Raybuck’s obligation to

pay. Furthermore, the trial court could exclude evidence as to programming

errors made by parties other than Arrowhead and Busse, because it was not

appropriate to fault Arrowhead and Busse for the errors of others, especially

independent third parties who were not party to the contract. Such evidence

seems to be more prejudicial than probative. See Pa.R.E. 403 (evidence is

excludable “if its probative value is outweighed by a danger of one or more of

the following: unfair prejudice, confusing the issues, misleading the jury,

undue delay, wasting time, or needlessly presenting cumulative evidence”).

Because Raybuck could not establish the trial court’s decision was clearly

erroneous, this claim fails.

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                     Denial of a Curative Instruction

      In its second issue, Raybuck argues that the trial court erred in declining

to issue a curative instruction after Arrowhead’s counsel made a statement in

closing argument to which Raybuck objected. We note Arrowhead’s attorney

said, “You didn’t hear any evidence that there was any complaints [as to the

depalletizer.] After it was installed, did [Giuseppe’s] come back and say these

items that we noted earlier at the factory acceptance test weren’t done? There

were no complaints that came back that said anything wasn’t corrected.” N.T.

Trial, 5/1/18, at 161-62. Raybuck’s counsel objected, and the objection was

sustained. Id. Raybuck’s counsel then requested that the jury be instructed

not to make any inferences about the absence of complaints. After hearing

argument, the trial court refused to give such an instruction. Id. at 166-67.

In its opinion and order of September 11, 2018, denying post-trial motions,

the trial court described the comment as de minimis and as therefore not

warranting a separate curative instruction. Trial Ct. Op., 9/11/18, at 2.

      “It is well settled that in reviewing a challenge to a jury instruction the

charge, as a whole, must be considered.       Furthermore, the trial court has

broad discretion in phrasing the instructions, so long as the directions given

‘clearly, adequately, and accurately’ reflect the law.” Grove v. Port Auth. of

Allegheny Cty., 218 A.3d 877, 887 (Pa. 2019) (citation omitted).            “[A]

reviewing court will not grant a new trial on the ground of inadequacy of the

charge unless there is a prejudicial omission of something basic or

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fundamental.” Id. at 888, quoting Stewart v. Motts, 654 A.2d 535, 540 (Pa.

1995).   Absent prejudice, a reviewing court will not disturb a jury verdict

based on a supposed error in the charge; a harmless error is not sufficient to

warrant a new trial. Id.

      Here, Raybuck attempts to extrapolate from its first argument,

concerning the excluded evidence, into this claim regarding Arrowhead’s

counsel’s closing argument. Raybuck claims the comment was doubly unfair

because the harm of the comment was compounded by the evidentiary ruling

excluding Raybuck’s alleged complaints about Arrowhead’s equipment.

However, it is clear from the context that counsel’s comment was limited in

scope, and was further cut short because of Raybuck’s timely objection, which

was sustained. Arrowhead’s counsel was speaking of a finite period of time,

and of a single machine. It is reasonable that the trial court would not want

to call further attention to such a minor transgression.

      Furthermore, Arrowhead’s comments appear to have been in response

to comments made during Raybuck’s closing argument, wherein his counsel

argued to the jury that there was not sufficient evidence that Arrowhead met

all its performance requirements.     N.T. Trial, 5/1/18, at 156.    Although

Raybuck’s objection was sustained, the comment about the lack of complaints

was in response to this line of argument.

      In addition, the court properly instructed the jury that the attorneys’

arguments are not evidence. N.T. Trial, 5/1/18, at 170. At the beginning of

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trial, the court instructed jurors that they were to disregard the subject of

lawyers’ objections if the court sustained the objection. N.T. 4/30/18, at 25-

26.   This Court cannot conclude that, when taken as a whole, the jury

instructions were inaccurate or inadequate.

      Although Raybuck cites cases, on appeal, on comments that inflame

passion or prejudice, applying these cases to a description of a depalletizer

and factory installation and review can only cast into stark contrast the relative

mildness of the commentary at issue here. Raybuck cites: Narciso v. Mauch

Chunk Twp., 87 A.2d 233 (Pa. 1952), in which counsel argued that the action

was “really” against the taxpayers and not the municipality; Mirabel v.

Morales, 57 A.3d 144 (Pa. Super. 2012), in which trial counsel used closing

arguments to inject the issue of racism into a case arising from a car accident;

Poust v. Hylton, 940 A.2d 380 (Pa. Super. 2007), in which counsel, having

been expressly forbidden from making mention of cocaine, nevertheless

stated that the decedent in a wrongful death action had a cocaine metabolite

in his system when he died; and Young v. Washington Hosp., 761 A.2d 559

(Pa. Super. 2000), in which counsel claimed that parents of an injured infant

were seeking only to profit from her injuries. Here, Arrowhead’s counsel’s

comment, limited in scope to a single piece of equipment, and limited

temporally, pertained to something that, while having great import to the

parties, had no inherent inflammatory qualities. Because Raybuck has not

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established that the comment was especially inflammatory or that Raybuck

was prejudiced thereby, this claim fails.

                              Breach of Contract

      In its third issue, Raybuck argues that the trial court erred in permitting

Arrowhead to change its claim as to Busse, its subsidiary, from an oral contract

claim to a written contract claim. Arrowhead pled in its complaint and argued

at trial that Busse and Raybuck had an oral agreement. At trial Arrowhead

submitted evidence of an email message from one of Raybuck’s employees

referring to that oral agreement. Raybuck now argues that Arrowhead pled

pretrial that Busse had an oral agreement with Raybuck, but that Arrowhead

then switched at the eleventh hour to a different breach theory, relying on the

email. Raybuck argues that in doing so, Arrowhead failed to give adequate

notice in its pleadings and to comply with pleading requirements.            See

Pa.R.Civ.P. 1019(h) (“When any claim or defense is based upon an agreement,

the pleading shall state specifically if the agreement is oral or written.”). When

the agreement is written, it must be attached to the pleading. Pa.R.Civ.P.

1019(i).

      Arrowhead, in turn, notes that Pennsylvania courts have admitted

emails as circumstantial evidence of the terms of an oral contract. See, e.g.,

F. Zacherl, Inc. v. Flaherty Mech. Contractors, LLC, 131 A.3d 1030, 1038

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(Pa. Cmwlth. 2016).4 Arrowhead asserts that its position has always been

that the contract at issue was oral, and thus that Raybuck is mischaracterizing

its position. Arrowhead’s Response Brief, at 29-32.

      The evidence adduced at trial includes an email discussion relating to an

oral agreement that Busse would perform certain on-site work. N.T. 4/30/18,

at 164-67. In an email message, a Raybuck employee requested a technical

service visit from Busse, offered that Raybuck would pay travel and expenses,

and stated that costs incurred would be added to a purchase order (although

it appears the purchase order was never so modified). Id. at 164-65.

      What Raybuck characterizes as Arrowhead’s vacillation between two

different theories of contract formation appears instead to be introduction of

circumstantial evidence to corroborate the existence of an oral agreement via

email. An email message can contain a contract or it can refer to a contract.

If an email message refers to a written contract, it does not necessarily render

it part of the contract. Instead it is evidence related to it. The same is true

here, though the contract was oral. The email message, produced by Raybuck

years before trial, is evidence tending to establish the existence of an oral

agreement.

      Although Raybuck frames its position as inadequate notice (per its

invocation of Rule 1019’s pleading requirements), its argument goes instead

4“Although a decision of the Commonwealth Court is not binding upon this
Court, it can be considered as persuasive authority.” Nw. Sav. Bank v.
Knapp, 149 A.3d 95, 98 n.3 (Pa. Super. 2016) (citation omitted).

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to sufficiency of the evidence.    Raybuck argues explicitly that there was

insufficient evidence to prove that an oral agreement had been reached.

Raybuck’s Brief at 61.

      Our Supreme Court has explained:

      When reviewing a sufficiency of the evidence claim in a civil case
      . . . an appellate court, viewing all the evidence and reasonable
      inferences therefrom in the light most favorable to the verdict
      winner, must determine whether the evidence was sufficient to
      enable the factfinder to find that all the elements of the causes of
      action were established by a preponderance of the evidence.
      Whether a claim was established under a preponderance of the
      evidence standard is “tantamount to a ‘more likely than not’
      inquiry.”

Samuel-Bassett v. Kia Motors Am., Inc., 34 A.3d 1, 34-35 (Pa. 2011)

(citations omitted).

      In its order and opinion of September 11, 2018, the trial court notes its

review of the record and concludes that the jury had ample evidence to find

the necessary elements for Arrowhead’s claims of breach. Order & Opinion,

9/11/18, at 3. The record confirms that the emails, coupled with relevant

testimony, establishes the existence of an oral agreement for additional

technical support supplemental to Arrowhead’s contract.            The emails,

produced by Raybuck, cannot form the basis for unfair surprise.              Thus,

whether posed as a sufficiency argument or a notice argument, this claim fails.

      Raybuck also claims the trial court erred in finding that Section 2.B of

the contract between Giuseppe’s and Arrowhead was applicable because it

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specified that it applied to “Parts & Service and equipment order less than

$15,000 value.”5 For ease of discussion, we reproduce that section:

            B. Parts & Service and equipment orders less than $15,000
            value Terms of Payment: The purchase price shall be payable
            in United States current funds as follows:

                 100% due upon shipment or completion of services

             Amounts due upon shipment shall be due when equipment
             is ready for shipment if [Giuseppe’s] notifies Arrowhead
             Conveyor that [Giuseppe’s] is not ready to receive the
             shipment. Such delayed shipment is subject to storage and
             handling charges and is payable upon presentation of
             invoice. If Arrowhead Conveyor is responsible for installation
             and [Giuseppe’s] delays or interrupts installation, the full
             balance of the purchase price less cost of completion of
             installation shall immediately become due. If installation is
             resumed, [Giuseppe’s] shall reimburse Arrowhead Conveyor
             for any increased costs resulting from such delays. In the
             event [Giuseppe’s] does not satisfy the terms of payment
             outlined herein, Arrowhead Conveyor reserves the right to
             assess a service charge of 1½% per month on the amount
             due on a pro-rata basis for any partial month on the amount
             due in arrears, provided there is no conflict with local or state
             law.

Arrowhead’s Amended Complaint, 8/7/08, Exh. D, at 24 (incorporated by

reference, Second Amended Complaint of 3/23/09).

        Raybuck’s argument contests the award of 1.5% interest per month for

overdue amounts owed under the contract, and relies on a typographical

indentation of the section carrying the disputed language as to interest on late

payments. Raybuck argues the indentation shows that the terms apply only

to a subsection on smaller purchases, and not all purchases. We disagree.

5   This section of the contract is quoted at length on pages 3 and 4, supra.

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      “[T]he interpretation of the terms of a contract is a question of law for

which our standard of review is de novo, and our scope of review is plenary.”

McMullen v. Kutz, 985 A.2d 769, 773 (Pa. 2009) (citation omitted). When

a contract is susceptible to two competing constructions, the one “which

makes it fair, customary and such as prudent [persons] would naturally

execute” is preferred. Felmont Oil Corp. v. Cavanaugh, 446 A.2d 1280,

1283 (Pa. Super. 1982) (citations & quotation marks omitted).

      Raybuck’s support lies solely in its interpretation of what it characterizes

as industry custom; there is no authority in Raybuck’s brief supporting its

interpretation of the contract. Raybuck’s argument is, essentially, that for

larger orders, custom dictates a bespoke payment term rather than a

boilerplate term. However, Raybuck’s resort to this argument is a blade that

cuts both ways – an adversary could just as easily argue that, because of the

large sums involved in more significant purchases, it is more important to rely

on standard terms for interest on tardy payments, as the impact of such

tardiness is greater.

      Raybuck’s argument would render the indented subsection in question

mere surplusage, and would leave the contract silent as to late payment. “A

term in a contract should not be treated as mere surplusage.”          Gralka v.

Isaacson, 556 A.2d 888, 891 (Pa. Super. 1989).               Further, Raybuck’s

proposed interpretation, in which the term on interest for payments in arrears

is tucked into the subsection on orders of less than $15,000 of value, would

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render that subsection internally inconsistent.   For such lower-cost orders,

payment is due in its entirety upon shipment or completion of services. The

disputed section, however, explicitly refers to amounts due upon shipment,

and refers to other terms including amounts due in arrears, as opposed to

amounts already paid, which would not apply to the lower-value scenario in

which there is one invoice, one payment due date, and no further

complications. This is neither a reasonable reading of the contract nor of the

laws of contract interpretation.     Contracts must be given a reasonable

interpretation reflecting the intention of the parties.   CBS Inc. v. Capital

Cities Commc’ns, Inc., 448 A.2d 48, 54 (Pa. Super. 1982). There being no

error in the application of the trial court of the operative contract term, this

argument fails.

                                    CASPA

      In its final issue, Raybuck avers the trial court erred in applying CASPA

to the judgment for Arrowhead. Raybuck argues that Arrowhead and Busse

are not contractors or subcontractors as defined by CASPA, that the underlying

agreements are not construction contracts as defined by the Act, and that

Arrowhead and Busse did not “improve” real property as defined by the Act.6

Raybuck raised its opposition to application of CASPA in a summary judgment

6 In its brief, Raybuck also argues that an ownership exclusion applies; this
argument does not appear in Raybuck’s Rule 1925(b) statement of matters
complained of on appeal and is therefore waived.             See Pa.R.A.P.
1925(b)(4)(viii).

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motion which was denied on November 10, 2014. Arrowhead responds on

appeal that it set forth competent evidence that the start-up and additional

technical services attendant to installation of Arrowhead’s equipment at

Raybuck’s facility satisfied CASPA’s requirements.

      This Court has stated:

      CASPA [is] a comprehensive statute enacted in 1994 to cure
      abuses within the building industry involving payments due from
      owners to contractors, contractors to subcontractors, and
      subcontractors to other subcontractors. The underlying purpose
      of [CASPA] is to protect contractors and subcontractors . . . [and]
      to encourage fair dealing among parties to a construction contract.
      The statute provides rules and deadlines to ensure prompt
      payments, to discourage unreasonable withholding of payments,
      and to address the matter of progress payments and retainages.
      Under circumstances prescribed in the statute, interest, penalty,
      attorney fees and litigation expenses may be imposed on an
      owner, contractor or subcontractor who fails to make payment to
      a contractor or subcontractor in compliance with the statute.

Zimmerman v. Harrisburg Fudd I, L.P., 984 A.2d 497, 500–01 (Pa. Super.

2009) (citations, footnotes, & quotations omitted); see also Prieto Corp. v.

Gambone Const. Co., 100 A.3d 602, 607 (Pa. Super. 2014). CASPA is a

remedial statute, and courts must accord it a liberal construction to effect its

objects and promote justice.    Lomas v. Kravitz, 130 A.3d 107, 131 (Pa.

Super. 2015).

      “Because statutory interpretation is a question of law, our standard of

review is de novo, and our scope of review is plenary.” Snead v. Soc’y for

Prevention of Cruelty to Animals of Pa., 985 A.2d 909, 912 (Pa. 2009).

      The object of interpretation and construction of all statutes is to
      ascertain and effectuate the intention of the General Assembly.

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      See 1 Pa.C.S. § 1921(a) . . . . When the words of a statute are
      clear and free from all ambiguity, their plain language is generally
      the best indication of legislative intent. A reviewing court should
      resort to other considerations to determine legislative intent only
      when the words of the statute are not explicit. 1 Pa.C.S. §
      1921(b) . . . In ascertaining legislative intent, this Court is guided
      by, among other things, the primary purpose of the statute, see
      1 Pa.C.S. § 1921(c)(4), and the consequences of a particular
      interpretation. Id. § 1921(c)(6).

In re Carroll, 896 A.2d 566, 573 (Pa. 2006) (some citations omitted). “[I]t

is axiomatic that in determining legislative intent, all sections of a statute must

be read together and in conjunction with each other, and construed with

reference to the entire statute.” Penn Jersey Advance, Inc. v. Grim, 962
A.2d 632, 634 (Pa. 2009). “All other provisions of a statute shall be liberally

construed to effect their objects and to promote justice.” 1 Pa.C.S. § 1928(c).

      Under CASPA, a “contractor” is “[a] person authorized or engaged by an

owner to improve real property.”          73 P.S. § 502 (“Definitions”).         A

“construction contract” is an agreement to perform work on any real property

located in Pennsylvania. Id.   To “improve” is “[t]o design, effect, alter,

provide professional or skilled services, repair or demolish any improvement

upon, connected with, or on or beneath the surface of any real property . . .

to furnish materials, . . . or to perform any labor upon improvements.” Id.

      Arrowhead argues it submitted evidence sufficient to support the trial

court’s determination that it provided startup support and additional technical

services on the equipment installed on the factory floor at Giuseppe’s. The

plain language of CASPA, where any analysis of statutory application must

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begin, broadly outlines the relevant terms. CASPA defines “improve” using

inclusive language, like “any”, and catalogs a broad variety of actions in

defining   improvement.        That   language    includes    “any   labor   upon

improvements.” 73 P.S. § 502.

      Raybuck cites Reco Equip. v. John T. Subrick Contracting, 780 A.2d
684 (Pa. Super. 2001), a case involving equipment rental. This case, about

the temporary furnishing of equipment, is not relevant and is distinguishable

from a case arising from a contract for permanent, fundamental improvements

to a manufacturing facility. The equipment that Arrowhead provided was part

of what made the facility a factory and not a warehouse or other type of

building. Raybuck also cites Apostolou Assocs., Inc. v. DiPardo, 2011 Pa.

Dist. & Cnty. Dec. LEXIS 76 (March 31, 2011), a Court of Common Pleas case

involving an agreement to explore the feasibility of a development project,

entered into before either party even owned the subject property, for

assistance with dealings with local planning and zoning officials. That opinion

is not binding on this Court; neither is it persuasive in this instance, given that

the facts are inapposite. See Branham v. Rohm & Haas Co., 19 A.3d 1094,

1103 (Pa. Super. 2011) (“[C]ommon pleas court decisions are not binding on

appellate courts.”).

      Arrowhead established both that it provided some level of customization

to the equipment and that it provided startup services on site. This is sufficient

to invoke CASPA’s protections. Even if the work provided was ancillary to the

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sale of equipment, the broad language of CASPA covers the work provided

and therefore its protections apply. Arrowhead was there, on site, to provide

labor upon improvements to real property. It submitted sufficient competent

evidence to establish that it did so. This argument fails.

                          Piercing the Corporate Veil

      Arrowhead raises a sole issue on appeal: whether the trial court erred

in denying its claim to pierce the corporate veil:

      Whether justice and equity require piercing the corporate veil and
      holding [Mr.] Raybuck personally liable for Giuseppes’ debt to
      [Arrowhead] where Giuseppes was grossly undercapitalized and
      rendered judgment proof as a result of Raybuck’s failure to
      contribute money from either ICP Global or his personal money so
      that Giuseppes had the ability to fully pay the equipment vendors
      involved in supplying equipment for the start up of Giuseppes’
      food processing operations.

Arrowhead’s Brief at 3.

      Arrowhead argues that Raybuck himself exercised exclusive control over

all the corporate entities involved in the deal and was aware that the bank’s

financing was not sufficient to satisfy the debts incurred to equipment

vendors. It argues that Giuseppe’s was grossly undercapitalized for purposes

of paying vendors, and Raybuck did nothing to remedy the situation. It argues

that justice and equity support piercing the corporate veil.

      The trial court noted the strong presumption against veil-piercing in

Pennsylvania law and found that the factors governing piercing the veil were

not established by Arrowhead. Trial Ct. Op., 6/2/17, at 29.

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      This Court has stated:

      Our appellate role in cases arising from non-jury trial verdicts is
      to determine whether the findings of the trial court are supported
      by competent evidence and whether the trial court committed
      error in any application of the law. The findings of fact of the trial
      judge must be given the same weight and effect on appeal as the
      verdict of a jury. We consider the evidence in a light most
      favorable to the verdict winner. We will reverse the trial court
      only if its findings of fact are not supported by competent evidence
      in the record or if its findings are premised on an error of law.
      However, [where] the issue . . . concerns a question of law, our
      review is plenary.

Stephan v. Waldron Electric Heating & Cooling LLC, 100 A.3d 660, 664–

665 (Pa. Super. 2014) (citation omitted).

      The “legal fiction of a separate corporate entity was designed to serve

convenience and justice, and will be disregarded whenever justice or public

policy demand and when the rights of innocent parties are not prejudiced nor

the theory of corporate entity rendered useless.” Ashley v. Ashley, 393 A.2d
637, 641 (Pa. 1978) (citations omitted). “[T]here is a strong presumption in

Pennsylvania against piercing the corporate veil.” Lumax Industries, Inc.

v. Aultman, 669 A.2d 893, 895 (Pa. 1995). Establishing that all stock in a

corporation is owned by one person is not sufficient to pierce the corporate

veil in Pennsylvania.   Kaites v. Pa. Dep’t. Enviro. Resources, 529 A.2d
1148 (Pa. Cmwlth. 1987) (rejecting application of alter ego liability theory).

      Our courts consider the following factors when determining whether to

pierce the corporate veil: (1) undercapitalization; (2) failure to adhere to

corporate formalities; (3) substantial intermingling of corporate and personal

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affairs, and (4) use of the corporate form to perpetrate a fraud.       Lumax

Industries, 669 A.2d at 895.        This Court has relied on the elements of

common law fraud in applying the Lumax Industries factors. See, e.g.,

Fletcher-Harlee Corp. v. Szymanski, 936 A.2d 87, 111-01 (Pa. Super.

2007).

      Undercapitalization, substantial intermingling, failure to adhere to

corporate formalities, and fraud: these are the guideposts of our inquiry. The

record suggests some intermingling between Raybuck’s various corporations.

For instance, ICP Global Payroll, LLC acted as paymaster for all employees,

regardless of which subsidiary employed them. Trial Ct. Op., 6/2/17, at 14.

Raybuck was president of, and managed daily operations for, all of the

corporate entities at issue here. Id.     The strongest evidence concerned

undercapitalization, and there Arrowhead has made a substantial showing.

      Evidence of the other Lumax Industries factors is weak or altogether

lacking. The evidence as to intermingling between corporate forms does not

necessarily establish intermingling of corporate and personal affairs. It is not

fraudulent for investors to take reasonable, legal steps to wind down a failing

business venture.   Although there is some evidence that Raybuck used its

various corporate structures to move assets in a way that would make them

less available to creditors by, for instance, transferring ownership of valuable

equipment from Giuseppe’s to ICP Asset and then leasing the equipment back

to Giuseppe’s, Arrowhead has not proven sufficient facts for this Court to

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conclude that veil-piercing is justified.    Where actions could be seen as

reasonable winding-down of a faltering investment, we will not view them

harshly and call it fraud without ample evidence.

      Although Arrowhead established evidence of undercapitalization, it did

not establish any of the other Lumax Industries factors to the extent

necessary to set aside the factual findings below.    Given the presumption

against veil-piercing, we affirm the judgment entered against Arrowhead on

this claim.

      February 1, 2019 judgment against Arrowhead on its piercing-the-

corporate-veil claim affirmed.   February 1, 2019 judgment on the parties’

remaining claims and counter-claims affirmed.

Judge Pellegrini joins this memorandum.

Judge McLaughlin concurs in the result.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 3/24/2020

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