Court Opinion

ID: 4090577
Source: CourtListenerOpinion
Date Created: 2016-10-19 03:32:59.243349+00
Date Added: 2024-06-11T14:35:09.242986
License: Public Domain

J-A13013-16

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

TRACY D. KIMMEL AND CHERYL A.                IN THE SUPERIOR COURT OF
KIMMEL, HUSBAND AND WIFE,                          PENNSYLVANIA

                          Appellee

                     v.

III TOMATO INC., A CORPORATION,

                          Appellant              No. 1016 WDA 2015

                 Appeal from the Order Entered May 29, 2015
              In the Court of Common Pleas of Lawrence County
                     Civil Division at No(s): 10878 of 2014

BEFORE: OLSON, STABILE AND MUSMANNO, JJ.:

MEMORANDUM BY OLSON, J.:                       FILED OCTOBER 18, 2016

     Appellant, III Tomato Inc., a corporation, appeals from the order

entered on May 29, 2015, denying its petition to open a confessed judgment

filed by Tracy D. Kimmel and Cheryl Kimmel (the Kimmels) pursuant to a

commercial lease. Upon review, we affirm.

     The trial court summarized the facts and procedural history of this

appeal as follows:

        The subject of [this appeal] is a confessed judgment that
        was entered against [Appellant] by [the Kimmels] pursuant
        to a confession of judgment clause contained in a
        commercial lease in which [the Kimmels] are the lessors
        and [Appellant] the lessee.

        On February 28, 2011, [Appellant] and the [Kimmels]
        entered into the subject Commercial Lease Agreement
        (hereinafter “Lease”). The leased premises are comprised
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       of part of a multi-tenant building and parking lot located in
       Neshannock Township, Lawrence County, Pennsylvania,
       consisting of a storefront containing approximately 3500
       square feet, having a street address of 2710 Wilmington
       Road, New Castle, Pennsylvania along with a parking lot, to
       be used in common with other occupants of the building.
       The Lease ha[d] an initial term of five years, beginning
       March 1, 2011 and ending February 28, 2016.

       […T]he confessed judgment [was] in the amount of
       $52,347.35, consisting of late rent charges for the period of
       May 2014 through February 2016, an amount for
       reimbursement for air conditioning repairs, and attorneys’
       fees.     [The] Kimmels’ notice of default alleged that
       [Appellant] was in default for (1) failure to obtain insurance,
       and provide proof of insurance to [the] Kimmels, (2)
       installing an unsafe and hazardous brick oven inconsistent
       with the requirements of applicable law, (3) failure to keep
       the premises in good condition and repair, including the roof
       and air conditioning unit, (5) failure to maintain and repair
       the roof and air conditioning unit, (6) failure to make timely
       payments of rent, and (7) failure to promptly pay expenses
       and repair of the air conditioning unit.

                          *         *           *

       In support of its [p]etition to [o]pen, [Appellant] allege[d],
       inter alia, that [the] Kimmels themselves breached the
       Lease by failing to perform their obligations under the Lease
       to maintain the common parking lot area serving the leased
       premises[,] by not repairing potholes and a light pole,
       refusing to repair the leaking roof on the building [that
       housed] the leased premises, and refusing to maintain and
       repair the air conditioning unit servicing the leased
       premises[. Appellant also alleged] that as a result of [the]
       Kimmels’ breaches of the Lease, [Appellant] suffered
       damages to its leasehold improvements in an amount
       greater than $5,000.00, lost revenues, increased cost,
       overall reduction in the value of its business, and losses in
       excess of $50,000.00. For a time in 2013, [Appellant] paid
       the rent into escrow in protest of [the] Kimmels’ failure to
       address [Appellant’s] complaints. The dispute was resolved
       and [Appellant] resumed making payments of rent directly

                                    -2-
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         to [the] Kimmels.       However, [Appellant] again began
         escrowing its rental payments beginning in May 2014.

         [The] Kimmels’ notice of default was sent to [Appellant] by
         letter dated August 8, 2014, asserting that [Appellant] was
         in default under the Lease for the reasons described above.
         On August 27, 2014, [the] Kimmels filed their [c]omplaint
         for [c]onfession of [j]udgment for [m]oney, claiming, inter
         alia, rent past due as well as accelerated rent due in the
         future during the remainder of the Lease’s term.           On
         September 26, 2014, [Appellant] filed its [p]etition to
         [s]trike and/or [o]pen [j]udgment, and execution on [the]
         Kimmels’ confessed judgment was stayed pending
         resolution of [Appellant’s] [p]etition. [Appellant] continued
         to pay the rental [sum] into escrow, but in October 2014,
         vacated the leased premises, and ceased paying rent. [On
         May 29, 2015, the trial court filed an order and
         accompanying memorandum denying Appellant relief.]

Trial Court Opinion, 5/29/2015, at 1-3 (record citations and footnote

omitted). This timely appeal resulted.1

       On appeal, Appellant presents the following issue for our review:

         1. Did the trial court err in denying Appellant[’]s petition to
            open judgment?2

____________________________________________

1
   Appellant filed a notice of appeal on June 29, 2015. On July 9, 2015, the
trial court directed Appellant to file a concise statement of errors complained
of on appeal pursuant to Pa.R.A.P. 1925(b). Appellant complied timely on
July 30, 2015. The trial court relied upon its earlier memorandum issued on
May 29, 2015 in support of its denial of relief.
2
    We note that Appellant filed a petition to strike/and or open judgment. In
its Rule 1925(b) statement, Appellant challenged the trial court’s refusal to
strike the judgment. On appeal, however, Appellant does not challenge the
trial court’s decision on the petition to strike judgment.          Accordingly,
Appellant has waived this issue for failure to develop an argument. See
Pa.R.A.P. 2119(b); Commonwealth v. Johnson, 985 A.2d 915, 924 (Pa.
2009) (“[W]here an appellate brief fails to provide any discussion of a claim
(Footnote Continued Next Page)

                                           -3-
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Appellant’s Brief at 4 (superfluous capitalization omitted).

      Appellant contends the trial court erred by denying its petition to open

judgment because it provided meritorious defenses to the confessed

judgment. Appellant argues the trial court erred by denying its petition to

open judgment when the trial court “concluded that [Appellant] did not

allege, nor did counsel argue, constructive eviction or a breach of quiet

enjoyment.” Id. at 9. Appellant contends that although it did not “explicitly

say the words ‘constructive eviction,’ Appellant more than adequately argued

that it was entitled to withhold rent as a result of [the Kimmels’] breaches –

i.e. that the Kimmels’ actions resulted in a constructive eviction.” Id. at 9-

10. More specifically, Appellant argues it “was only required to state that

rent was not owed due to the Kimmels’ breach of the Lease.”          Id. at 10.

Next, Appellant asserts the trial court erred by treating its loss of business

claims, in excess of the judgment amount, as set-offs “because they arose

as direct result of the Kimmels’ breach of the Lease.” Id. at 12. As a result,

Appellant maintains that its claims “must be characterized as a failure of

consideration.”        Id.     Finally, Appellant argues “[t]he [t]rial [c]ourt

erroneously determined that [Appellant] was responsible for the repair and

replacement of the air conditioning” system.        Id. at 13.   At a minimum,

Appellant contends, “the Lease is ambiguous” because it states that

                       _______________________
(Footnote Continued)

with citation to relevant authority or fails to develop the issue in any other
meaningful fashion capable of review, that claim is waived.”).

                                            -4-
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Appellant “shall be responsible for all maintenance and repairs” but provides

that the Kimmels “shall furnish the existing equipment for maintaining

heating and air conditioning for the leased premises.” Id.

     Our standard of review is well settled:

        We review the order denying Appellant's petition to open
        the confessed judgment for an abuse of discretion. Judicial
        discretion requires action in conformity with law on facts
        and circumstances before the trial court after hearing and
        consideration. Consequently, the court abuses its discretion
        if, in resolving the issue for decision, it misapplies the law or
        exercises its discretion in a manner lacking reason.

        The trial court may open a confessed judgment if the
        petitioner (1) acts promptly, (2) alleges a meritorious
        defense, and (3) can produce sufficient evidence to require
        submission of the case to a jury. Generally, the court will
        dispose of the rule on petition and answer, along with other
        discovery and admissions.

        When determining if the petitioner acted promptly, the
        courts are not bound by an inflexible time frame. The crucial
        factor in determining whether a petition is timely is not the
        specific time which has elapsed but rather the
        reasonableness of the explanation given for delay.

        A meritorious defense is one upon which relief could be
        afforded if proven at trial. Pa.R.Civ.P. 2959(e) sets forth the
        standard by which a court determines whether a moving
        party has properly averred a meritorious defense. If
        evidence is produced which in a jury trial would require the
        issues to be submitted to the jury the court shall open the
        judgment. Furthermore, the court must view the evidence
        presented in the light most favorable to the moving party,
        while rejecting contrary evidence of the non-moving party.
        The petitioner need not produce evidence proving that if the

                                      -5-
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          judgment is opened, the petitioner will prevail.[3] Moreover,
          we must accept as true the petitioner's evidence and all
          reasonable and proper inferences flowing therefrom.

          In other words, a judgment of confession will be opened if a
          petitioner seeking relief therefrom produces evidence which
          in a jury trial would require issues to be submitted to a jury.
          The standard of sufficiency here is similar to the standard
          for a directed verdict, in that we must view the facts most
          favorably to the moving party, we must accept as true all
          the evidence and proper inferences in support of the
          defense raised, and we must reject all adverse allegations.
          The trial court can make this decision as a matter of law
          when the defense presented is without adequate substance,
          because contract construction and interpretation is
          generally a question of law for the court to decide.

          A contract's language is unambiguous if it can               be
          determined without any other guide than knowledge of        the
          simple facts on which its meaning depends. When             the
          contract is clear and unambiguous, the meaning of           the
____________________________________________

3
    On presenting a meritorious defense, we have further clarified:

          The [defendant] does not have to prove every element of its
          defense; however, it must set forth the defense in precise,
          specific and clear terms.

          Merely asserting in a petition to open default judgment that
          one has a meritorious defense is insufficient. The moving
          party must set forth its meritorious defense. If any one of
          the alleged defenses would provide relief from liability, the
          moving party will have pled a meritorious defense and will
          have satisfied the third requirement to open the default
          judgment.

Seeger v. First Union Nat. Bank, 836 A.2d 163, 166 (Pa. Super. 2003);
see also Ecumenical Enterprises, Inc. v. NADCO Const., Inc., 385 A.2d
392, 395 (Pa. Super. 1978) (“It is clear that the petition to open must set
forth its defenses in precise, specific, clear and unmistaken terms and must
set forth the facts on which the defense is based.”) (internal citation and
quotations omitted).

                                           -6-
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        contract is ascertained from the writing alone. A court must
        not distort the meaning of the language or resort to a
        strained contrivance to find an ambiguity. Additionally, a
        mere disagreement between the parties regarding the
        proper construction of the language does not render the
        contract ambiguous. In the context of a petition to open a
        confessed judgment, the function of our Court is not to
        weigh the evidence in support of the defense, but merely to
        determine whether there was sufficient evidence to go to
        the jury.

        Whether a judge has correctly interpreted a writing and
        properly determined the legal duties which arise therefrom
        is a question of law for the appellate court. The legal effect
        or enforceability of a contract provision presents a question
        of law accorded full appellate review and is not limited to an
        abuse of discretion standard. Likewise, if the matter under
        review involves the interpretation of the Pennsylvania Rules
        of Civil Procedure, we have before us a question of law,
        where our standard of review is de novo and our scope of
        review is plenary.

Neducsin v. Caplan, 121 A.3d 498, 506–507 (Pa. Super. 2015) (internal

citations and quotations omitted).

     In this case, the lease provided, inter alia:

                           *         *               *

        5. PARKING.        [Appellant’s] customers, invitees, and
        licensees shall have the right, during the term of this Lease,
        to use in common with [the Kimmels’] other tenants, their
        agents, licensees and other tenants, the parking lot owned
        by [the Kimmels] and located adjacent to the Leased
        Premises. […] [Appellant] shall not be responsible for any
        repairs required of the subject parking area.

                           *         *               *

        12. INDEMNITY AND RELEASE. […] [Appellant] agrees
        that the Leased Premises and appurtenances are delivered
        in good repair and in a safe and tenable condition and
        accepted in an “AS IS” condition. Without limiting the

                                     -7-
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       foregoing, [the Kimmels] shall not be responsible or in any
       manner liable to [Appellant] or any other person
       whomsoever for any loss, damage or injury occasioned by
       rain, snow or the elements[.]

       13. CONDITION OF PREMISES.              It shall be the sole
       responsibility of [Appellant] to keep the Leased Premises
       and every part thereof in good condition and repair and in a
       clean, safe and sanitary condition and, upon the expiration
       or sooner termination of this lease, or any extension
       thereof, to promptly surrender the Leased Premises back to
       the [Kimmels] in as good condition as received by
       [Appellant] except for reasonable wear and tear.           All
       damages resulting from the installation and removal of any
       property by [Appellant] shall be fully repaired by [Appellant]
       prior to the surrender of possession.

       14. [APPELLANT’S] RESPONSIBILITIES.              [Appellant]
       shall be responsible for all maintenance and repairs, except
       for those for which the [Kimmels] [are] responsible,
       including but not limited to, maintenance and repair of plate
       glass windows, glass doors and frames thereof.

                          *         *           *

       15. [THE KIMMELS’] RESPONSIBILITIES.

          A.     [The Kimmels] shall maintain in good condition
          the exterior of the building, the roof, and structural
          members of the building of which the Leased
          Premises form a part, and any water, gas, or
          electrical lines or conduits permanently imbedded in
          walls or floors.

                         *           *           *

          B.    [The Kimmels] shall furnish the existing
          equipment for maintaining heating and air
          conditioning for the Leased Premises.
                         *          *           *

          D.   The [Kimmels] at all times shall be solely
          responsible for and shall keep and maintain the
          sidewalks, parking lot, driveway and pavement of

                                   -8-
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          the Leased Premises in a safe and clean condition
          and free from all hazards, ice and snow.        [The
          Kimmels] shall be responsible for all repairs to and
          replacement of all sidewalks, driveways and parking
          lots located on the Leased Premises.

                         *        *            *

       21. SURRENDER. No act or conduct of [the Kimmels],
       whether consisting of the acceptance of keys to the Leased
       Premises, or otherwise, shall be deemed to be or constitute
       an acceptance or the surrender of the Leased Premises by
       [Appellant] prior to the expiration of the term hereof and
       such acceptance by [the Kimmels] of surrender by
       [Appellant] shall only occur and must be evidenced by a
       written acknowledgment of acceptance of surrender signed
       by [the Kimmels].

                         *        *            *

       27. RESPONSIBILITIES OF [THE KIMMELS].

                        *         *           *
          D.    Damage for Interruption of Use.

          [The Kimmels] shall not be liable for any damage,
          compensation or claim by reason of inconvenience or
          annoyance arising from the necessity of repairing
          any portion the building, the interruption in the use
          of the Leased Premises, or the termination of this
          lease by reason of damage or for any reason
          whatsoever.

                             *          *           *

          F.    Representation   of     Condition   of   Leased
                Premises

          Except as set forth herein, the [Kimmels] have not
          made and do not make any warranties and/or
          representations, express or implied, as to the
          physical condition, habitability, layout, footage,
          income, expense, operation, compliance with moving
          and building laws, or other matter or thing

                                  -9-
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           whatsoever affecting or in any manner related to the
           Leased Premises and this lease. [Appellant] accepts
           the premises in an “AS IS” condition. The [Kimmels]
           have let the Leased Premises in [its] present
           condition    and   without    any    warranties   or
           representations, express or implied, on the part of
           the [Kimmels], their employees, servants, and/or
           agents.    It is understood and agreed that [the
           Kimmels] are under no duty to make alterations or
           repairs at the time of letting or at any time
           thereafter.

Commercial Lease Agreement, 2/28/2011, at 2-12.

     In support of its petition to open, Appellant averred, in pertinent part:

                         *            *           *

     6.    It was not [Appellant] but the [Kimmels] that
           breached the lease agreement attached to the
           complaint.

     7.    Paragraph 5 of said lease agreement states that the
           [Kimmels] will be responsible for the repair of the
           parking lot at the premises.

     8.    [Appellant] had informed [the Kimmels] that as a
           result of the severe weather during the past winter
           (2013-2014), the parking lot had developed several
           deep and dangerous potholes.

     9.    [The Kimmels] on several occasions had stated that
           they would repair the damage to the parking lot but
           ha[d] continually refused to make the necessary
           repairs.

     10.   The roof of said premises leased to [Appellant] has
           been leaking for more than a year. The [Kimmels]
           have refused to repair the leak in the roof and to
           date [Appellant’s] leasehold improvements have
           been damaged in an amount greater than $5,000.00.

     11.   An outside light pole in the parking lot of the
           premises was struck by a vehicle and had fallen to

                                    - 10 -
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            the ground in 2013. To date the light pole and lamp
            have not been replaced causing the parking lot to be
            unsafe and poorly lit at night.

     12.    In May 2014, the roof top air[-]conditioning unit
            stopped working.

     13.    The lease agreement requires the [Kimmels] to
            maintain the air conditioning units that were in place
            at the time the lease agreement was executed.

     14.    This roof top unit was in place at the time of the
            execution of the lease agreement and the [Kimmels]
            have failed to repair, fix or replace the unit.

     15.    [Appellant’s] business income [h]as decreased
            significantly as a result of [the Kimmels’] breach of
            the lease agreement.

     16.    As a result of [the Kimmels’] breach of the lease
            agreement, [Appellant] has lost revenues, increased
            its cost and seen an overhaul [sic] reduction in the
            value of its business.

     17.    [Appellant’s] business has suffered losses in excess
            of $50,000.00 as a result of [the Kimmels’] breach of
            the lease agreement.

     18.    As a result of [the Kimmels’] breach of the lease
            agreement, [Appellant] does not owe the [Kimmels]
            the sums set forth in the [c]onfession of [j]udgment
            for [m]oney filed in this matter.

                         *              *             *

Appellant’s Petition to Strike and/or Open Judgment, 9/26/2014, at 2-3

(unpaginated).

     Initially,   we   will   examine       Appellant’s   claims   pertaining   to   the

air-conditioning system.       The Kimmels agreed to “furnish the existing

equipment for maintaining heating and air conditioning for the Leased

                                        - 11 -
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Premises.”    Commercial Lease Agreement, 2/28/2011, at 6, ¶ 15B.

Appellant agreed that the property “and appurtenances [we]re delivered in

good repair and in a safe and tenable condition and accepted in an ‘AS IS’

condition.” Id. at 4, ¶ 12. The Kimmels had no duty “to make alterations or

repairs at the time of letting or at any time thereafter.”   Id. at 12, ¶ 27F.

Appellant agreed to be responsible for all maintenance and repairs to the

premises, unless expressly delineated to the Kimmels under a specific

provision of the lease. Id. at 5, ¶ 14. Appellant has not pointed to, and our

review of the lease has not revealed, a specific provision of the lease that

holds the Kimmels responsible for air conditioner maintenance.

      Based upon the foregoing, we discern no ambiguity in the lease.

Initially, we reject Appellant’s proposition that the use of the word

“maintain” in paragraph 15B of the lease suggests the Kimmels are

responsible for maintaining the heating and air conditioning equipment. The

plain contractual language states that the Kimmels “shall furnish the existing

equipment for maintaining heating and air conditioning for the Leased

Premises.” Commercial Lease Agreement, 2/28/2011, at 6.          The Kimmels

were only required to “furnish” the “existing” equipment.          The word

“maintaining” is in reference to the equipment, not the Kimmels. The plain

meaning of the lease provided that the “existing equipment” was “for

maintaining” or providing temperature control.        The provision is wholly

silent regarding repairs.   It simply does not state that the Kimmels shall

                                    - 12 -
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furnish the existing equipment and bear responsibility for maintaining that

equipment. Moreover, Appellant agreed that at the time of the contract, in

February 2011, the equipment was in good repair and accepted the premises

“as is.”   Appellant averred, in its petition to open judgment, the air

conditioning unit stopped working in May 2014. However, under the lease,

the Kimmels simply had no duty to make repairs more than three years

later. Thus, Appellant failed to provide a meritorious defense regarding the

air conditioning system that supported its petition to open the confessed

judgment in this regard.

      Next, we examine Appellant’s claims regarding repairs to the roof and

parking lot. There is no dispute that pursuant to paragraph 15(a) and (d),

the Kimmels were responsible for those repairs.                Commercial Lease

Agreement, 2/28/2011, at 5-6.

      Our Pennsylvania Supreme Court has stated, “[n]othing is better

settled in Pennsylvania than that a tenant for years cannot relieve himself

from his liability under his covenant to pay rent by vacating the demised

premises   during   the    term,   and   sending   the   key   to   his   landlord.”

Stonehedge Square Ltd. Partnership v. Movie Merchants, Inc., 715
A.2d 1082, 1084 (Pa. 1998). Our Supreme Court determined, “where the

landlord materially breaches express covenants to repair or to maintain the

leasehold in a habitable state[,]” it is analogous to a breach of the implied

warranty of habitability. Pugh v. Holmes, 405 A.2d 897, 907 (Pa. 1979).

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“The covenants and warranties in the lease are mutually dependent, the

tenant’s obligation to pay rent and the landlord’s obligation imposed by the

implied warranty of habitability to provide and maintain habitable premises

are, therefore, dependent and a material breach of one of these obligations

will relieve the obligation of the other so long as the breach continues.”

Pawco, Inc. v. Bergman Knitting Mills, Inc., 424 A.2d 891, 894 (Pa.

Super. 1980) (en banc), citing Pugh, 405 A.2d at 903.

      In cases involving a breach of habitability, a tenant may:           (1)

surrender possession of the premises; (2) remain in possession subject to

rent abatement; or (3) repair the defects and deduct the cost of repairs from

the rent.   Echeverria v. Holley, 2016 WL 3268695, at *4 (Pa. Super.

2016), citing Pugh, 405 A.2d at 907–908.         To relieve the tenant from

further liability under the lease, the burden is on the tenant to show by clear

and convincing evidence that the landlord accepted the tenant's surrender.

Stonehedge Square Ltd. Partnership v. Movie Merchants, Inc., 685
A.2d 1019, 1023 (Pa. Super. 1996), affirmed, 715 A.2d 1082 (Pa. 1998).

      Moreover, unlike a mutual surrender, this Court recently examined the

defense of constructive eviction, stating:

        constructive eviction is one species of a violation of the
        lessee's right to quiet enjoyment. While one might gain
        relief for such a violation without being constructively
        evicted, one cannot be constructively evicted absent such a
        violation. In effect, constructive eviction occurs when a
        lessor's violation of a lessee's entitlement to quiet
        enjoyment is so extreme as to interfere seriously with the
        lessee's ability to use the leasehold as it was intended to be

                                    - 14 -
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        used, and the violation prompts the tenant to abandon the
        property within a reasonable amount of time.

Sears, Roebuck & Co. v. 69th Street Retail Mall, L.P., 126 A.3d 959,

973 (Pa. Super. 2015).

      In this case, upon review, we conclude Appellant did not plead a

defense of constructive eviction in its petition to open.    Appellant alleged

that its business income “decreased significantly” and it “lost revenues.” It

further claimed its costs increased and its business value was reduced “in

excess of $50,000.00” as a result of the Kimmels’ purported breach of the

lease agreement.     Appellant’s Petition to Strike and/or Open Judgment,

9/26/2014, at 2-3 (unpaginated).     Appellant concedes it never specifically

alleged constructive eviction, but argues the aforementioned allegations

were sufficient to assert that no rent was due because the Kimmels

breached the lease.      Appellant’ Brief at 9-10.   However, Appellant was

required to set forth its defenses in precise, specific, clear and unmistakable

terms. Ecumenical Enterprises, Inc., 385 A.2d at 395. Appellant did not

aver that the damages were so extreme as to interfere seriously with its

ability to use the leasehold as it was intended to be used or that the

violation prompted Appellant to abandon the property. Sears, Roebuck &

Co., 126 A.3d at 973.        While Appellant now argues the maintenance

problems were sufficient to constitute a complete breach that justified

terminating the lease, we simply cannot address issues raised for the first

                                    - 15 -
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time on appeal. See Pa.R.A.P. 302(a). Thus, we conclude Appellant did not

sufficiently set forth a constructive eviction defense in its petition to open.

      Moreover, upon review of the record, Appellant did not employ any of

the three options available to address a breach of habitability.           Under

paragraph 21 of the lease, if Appellant intended to surrender the property, it

was required to obtain “written acknowledgement of surrender signed by”

the Kimmels. Commercial Lease Agreement, 2/28/2011, at 9. The burden is

on Appellant to show by clear and convincing evidence that the landlord

accepted a tenant's surrender. Stonehedge Square Ltd. Partnership, 685
A.2d at 1023.    Here, there is no evidence of surrender. Appellant may have

unilaterally and voluntarily abandoned the premises, but it was not relieved

of its obligation to continue paying rent under the lease. Further, Appellant

did not aver in its petition to open that it remained in possession of the

leasehold subject to rent abatement or that it repaired the defects and

deducted the cost of repairs from the rent.

      Finally, we reject Appellant’s contention that the trial court erred by

characterizing its claims as set-offs or unliquidated counterclaims.       For its

proposition, Appellant relies on our Supreme Court’s 1963 decision in

Nadolny v. Scoratow, 195 A.2d 87 (Pa. 1963).            See Appellant’s Brief at

11-12.   A brief recitation of that case reveals distinctions.      In Nadolny,

Nadolny leased a two-story building to Scoratow specifically for the storage

of pre-cast stone. When the second floor buckled under the weight of the

                                      - 16 -
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stored material, Scoratow abandoned the property.                Nadolny confessed

judgment under the lease for unpaid rent.            Scoratow subsequently filed a

petition to open the judgment arguing the damage to the premises was the

result of Nadolny's misrepresentation that the second floor could support the

weight    of    the   pre-cast     stone.      Scoratow   also   argued   that   such

misrepresentation entitled him to rescind the lease and avoid liability for the

remaining unpaid rent.          The Supreme Court agreed, noting that if the

alleged misrepresentation was proven to a jury, the agreement would be

disaffirmed.    Stated differently, the property owner’s misrepresentation of

the premises fraudulently led to the lease formation and amounted to a lack

of consideration.4 Accordingly, if a jury determined as such, the lease would

be invalidated in its entirety.        Thus, the Nadolny Court determined that

opening the confessed judgment in that case was proper.

       By contrast, in this case, there was a five-year commercial lease.

Both parties largely performed under the lease for the better part of four

years (i.e., occupancy, rental payments, receipt of rent, and some repairs).

Hence, it is difficult to say there was a complete failure of consideration and,

therefore, no contract in place. Appellant does not allege that the Kimmels

made misrepresentations requiring a complete invalidation of the lease,
____________________________________________

4
   Our Rules of Civil Procedure offer additional support for our conclusion.
Specifically, Pa.R.C.P. 1030 provides that “fraud” and “failure of
consideration” constitute affirmative defenses; whereas, “set-offs” arising
from breach of contract are not considered as such. See Pa.R.C.P. 1030(a).

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J-A13013-16

outright barring their right to recover the unpaid rent.   Instead, Appellant

contends the Kimmels’ breached the lease. Appellant’s Brief at 12.      Such

assertion amounts to a counterclaim, which is not proper in a petition to

open judgment.

      Based upon all of the foregoing, we conclude Appellant did not allege a

meritorious defense requiring submission to a jury.    Accordingly, the trial

court properly denied Appellant’s petition to open.

      Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 10/18/2016

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