Court Opinion

ID: 6321187
Source: CourtListenerOpinion
Date Created: 2022-03-08 18:11:25.89346+00
Date Added: 2024-06-11T09:11:13.535297
License: Public Domain

J-A26035-21

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

 RITE AID HEADQUARTERS                     :   IN THE SUPERIOR COURT OF
 CORPORATION                               :        PENNSYLVANIA
                                           :
                                           :
              v.                           :
                                           :
                                           :
 BRINES REFRIGERATION HEATING &            :
 COOLING                                   :   No. 992 EDA 2021
                                           :
                    Appellant              :

             Appeal from the Order Entered December 24, 2020
    In the Court of Common Pleas of Philadelphia County Civil Division at
                            No(s): 200401092

BEFORE: BOWES, J., STABILE, J., and McCAFFERY, J.

MEMORANDUM BY McCAFFERY, J.:                             FILED MARCH 8, 2022

      Brines Refrigeration Heating & Cooling (Appellant) appeals from the

order entered in the Philadelphia County Court of Common Pleas, denying its

motion to stay proceedings concerning Rite Aid Headquarters Corporation’s

(Rite Aid) complaint, or in the alternative, for a protective order to limit

discovery. On appeal, Appellant claims the underlying case involves a claim

for fraudulent collection of sales tax and therefore, it must be stayed until the

applicable taxing authorities address the issue as required by Stoloff v.

Neiman Marcus Group, Inc., 24 A.3d 366 (Pa. Super. 2011). Based on the

following, we affirm.

      The trial court set forth the relevant facts and procedural history, which

were derived from the verified complaint, as follows:
J-A26035-21

              [Rite Aid] is a pharmacy chain with stores located
       throughout the United States including Pennsylvania. [Appellant]
       is a commercial mechanical contractor that performs HVAC,
       lighting, refrigeration and other general services. From 2004 to
       2019, [Rite Aid] contracted with [Appellant] to perform various
       maintenance and related services at its various locations in more
       than 20 states, including Pennsylvania. During this time period,
       various contracts were executed by the parties which set forth the
       contractual relationship and obligations between [Rite Aid] and
       [Appellant]. Specifically, the 2010 Master Service Agreement
       [(“MSA”)] and the 2016 [MSA], in particular, required that
       [Appellant]’s invoices identify “state sales tax” when applicable.
       Additionally, the 2013 HVAC Agreement also included a “Retail
       Facilities Invoice Procedure” which required that “All Invoices
       MUST list separately the overhead and profit rate and applicable
       sales or other tax, if any. Vendor shall be responsible for all
       collected taxes associated with paid invoices.” Furthermore, the
       2010 MSA, the 2016 MSA, the 2013 HVAC Agreement, Lighting
       Agreement and the 2018 HVAC Agreement also contain[ed]
       indemnification provisions and assurances that [Appellant] was in
       compliance with all current federal, state and local laws and
       regulations.

             Since 2010, [Appellant] issued to [Rite Aid] more than
       150,000 invoices which include a line item change for either “tax”,
       “sales tax” and/or the name of the taxing juris[di]ction. At all
       times relevant hereto, [Rite Aid] paid [Appellant]’s invoices,
       including the line item charge for “tax”, “sales tax” and/or that
       contained the name of the taxing authority.[1]

              In January 2019, the PA Department of Revenue
       (“Department”) sent [Rite Aid] the results of a sales tax audit of
       [its] subsidiary Thrift Drug, Inc. covering the audit period of May
       1, 2015 to February 8, 2018. As a result of the audit, the
       Department assessed additional tax amounts in approximately
       177 invoices that [Rite Aid] received from [Appellant] during the
       relevant audit period for which the Department determined that
       [Rite Aid] had not paid any PA sales or use tax for the taxable
       service identified in [Appellant]’s invoices.
____________________________________________

1 Rite Aid purportedly paid Appellant “more than $5.1 million of ‘tax.’”
Complaint, 4/22/2020, at 2.

                                           -2-
J-A26035-21

            Also, in 2019, the Department began a separate sales audit
     of Rite Aid, Inc. [Rite Aid] retained Keystone Tax Associate’s, a
     sales and use tax consulting firm, to help in reviewing the sales
     and use tax Rite Aid paid to the Commonwealth of [Pennsylvania]
     and related issues. In November 2019, representatives from
     Keystone and Rite Aid met with the Department state tax auditors
     to discuss the preliminary assessment of use tax on Rite Aid of PA
     for the invoices issued by [Appellant] that included a “tax” line
     item. State auditors informed Rite Aid that the Department
     was unable to locate any record of [Appellant] being
     registered with or licensed by the Department to collect
     and remit PA sales tax. The State Auditors also informed
     [Rite Aid] that the Department did not have records of
     [Appellant] remitting any sales tax to the department. The
     Department also informed [Rite Aid] that they did not recognize
     the “tax” listed on the invoices issued by [Appellant] and paid by
     [Rite Aid] because unless [Appellant] was remitting the tax to the
     department using a different name, the tax listed on the invoice
     had not been remitted and was not a PA sales tax.

            On January 23, 2020, during a call between representatives
     of [Rite Aid] and [Appellant], [Appellant] provided [Rite Aid] with
     the following information: 1) [Appellant] had not paid sales tax
     for work performed in Pennsylvania to the Department or the tax
     authorities in other states and 2) the itemized “tax” listed on
     [Appellant]’s invoice was not actually a tax but some other charge
     by [Appellant]. [Appellant] did not explain what it claimed the
     line item stating “tax” represented.

           The Department in connection with a closed audit, assessed
     [Rite Aid] use tax, interest and fines for the work performed by
     [Appellant]. In connection with an open audit, the Department
     has informed [Rite Aid] that it will be assessed additional use tax
     for work performed by [Appellant] even though [Rite Aid] paid the
     “tax” to [Appellant] for the work.

Trial Ct. Op., 7/28/21, at 1-4 (footnotes omitted; emphasis added).

     In April 2020, Rite Aid instituted a lawsuit against Appellant, raising

claims of breach of contract, fraud, unjust enrichment, and negligent

misrepresentation based on its reliance that Appellant remitted the taxes

                                    -3-
J-A26035-21

collected from Rite Aid to the proper state tax authorities. See Complaint,

4/22/2020, at 1-15.         Rite Aid sought damages for the money Appellant

purportedly stole under the guise of a charge of “tax” on the invoices. Rite

Aid also requested a declaratory judgment, seeking an order and judgment

stating it was “entitled to indemnification from [Appellant] for any actions by

state tax authorities related to [Appellant]’s misconduct, including for any

future tax liability, losses, damages, attorney’s fees, interest and any other

cost Rite Aid may incur.” Id. at 16.

       On September 9, 2020, Appellant filed a motion to stay proceedings

based on Stoloff, supra, or, in the alternative, for a protective order to limit

discovery.2 Appellant alleged that Rite Aid requested these tax payments be

returned but it could not do so based on the following assertion:

       [O]nce taxes are collected by a seller like [Appellant], the taxes
       become the property of the state. [Appellant] cannot simply be
       ordered to pay the taxes back because the taxes would not belong
       to [Appellant]. They belong to the state. [Rite Aid]’s recourse
       [was] to seek redress with the state.

Appellant’s Motion to Stay Proceedings on Plaintiff’s Complaint and, in the

Alternative, to Limit Discovery, 9/9/20, at 5 (citation omitted).      Rite Aid

____________________________________________

2 In addition to the motion to stay, Appellant filed one set of preliminary
objections (POs) and two sets of amended POs. Rite Aid filed responses to the
POs, its own POs to Appellant’s POs, and POs to Appellant’s answer, new
matter, and counterclaim as well as its amended answer and new matter.
Lastly, Rite Aid filed a motion for attorney fees.

                                           -4-
J-A26035-21

responded to the motion.         The trial court reviewed the matter and denied

Appellant’s motion to stay proceedings or limit discovery.3

        In January 2021, Appellant filed an application for an amendment of the

court’s order denying its motion to stay on Rite Aid’s complaint to include

language specified by 42 Pa.C.S. § 702(b),4 thereby certifying the order for

interlocutory appeal.      Appellant alleged there was “substantial ground for

disagreement on the controlling issue of law which need[ed], from a practical

perspective, to be resolved before trial[.]”      Appellant’s Application for an

Amendment of the Court’s Order Denying Appellant’s Motion to Stay to Certify

an Interlocutory Appeal, 1/19/2021, at ¶ 11. The trial court did not dispose

of the motion within the required 30 days and therefore, the application was

deemed denied pursuant to Pa.R.A.P. 1311.

____________________________________________

3The court’s order was dated December 23, 2020, but docketed the following
day. The court entered the order without an opinion.

4   Subsection 702(b) provides:

        (b) Interlocutory appeals by permission. — When a court or
        other government unit, in making an interlocutory order in a
        matter in which its final order would be within the jurisdiction of
        an appellate court, shall be of the opinion that such order involves
        a controlling question of law as to which there is substantial
        ground for difference of opinion and that an immediate appeal
        from the order may materially advance the ultimate termination
        of the matter, it shall so state in such order. The appellate court
        may thereupon, in its discretion, permit an appeal to be taken
        from such interlocutory order.

42 Pa.C.S. § 702(b).

                                           -5-
J-A26035-21

      Appellant then filed a petition for permission to appeal with this Court

pursuant to Rule 1311. In a per curiam order, this Court granted the petition

on May 21, 2021. The matter is now before us.

      Appellant presents the following issue for our review:

      Whether a Common Pleas case involving a claim for fraudulent
      collection of sales tax must be stayed until the applicable taxing
      authorities address the issue as required by this Court’s opinion in
      Stoloff v. Neiman Marcus Group, Inc., 24 A.3d 366 (Pa. Super.
      2011)?

Appellant’s Brief at 2.

      The crux of Appellant’s argument is that the present proceedings must

be stayed pursuant to the doctrine of primary jurisdiction and this Court’s

ruling in Stoloff “which requires the stay of any civil litigation of ‘any dispute’

regarding sales tax pending exhaustion of administrative remedies with the

applicable taxing authority.” Appellant’s Brief at 4-5. Appellant avers:

            This is, in part, because a seller collects sales tax as an
      agent for the taxing authority and holds the funds in trust for the
      taxing authority. This means a seller cannot simply return the
      funds to the purchaser. Once collected, sales taxes generally
      belong to the taxing authority and cannot be returned without
      proceedings involving the taxing authority.

            Because Rite Aid alleges [Appellant] collected sales tax from
      it but failed to remit those taxes to the appropriate authorities,
      this Court should direct the trial court to stay all proceedings in
      the civil action until all required proceedings before the
      Pennsylvania Department of Revenue are concluded. As a matter
      of comity, the stay should also be applied until future proceedings
      before taxing authorities outside of the Commonwealth are
      concluded.

Id. at 5.

                                       -6-
J-A26035-21

      Appellant further contends that the court’s decision was based on two

erroneous grounds. Appellant’s Brief at 6. First, Appellant alleges that the

court erred in concluding that there was “no allegation in the complaint, or

reasonable inference, that the ‘tax’ is a sales tax or that [Appellant] is holding

the tax in trust.” Id. (footnote omitted). In support of its assertion, Appellant

points to paragraph 5 of Rite Aid’s complaint, which states that “[Appellant]

collected ‘sales tax’ from Rite Aid and f[a]iled to remit it to taxing

authorities[,]” and paragraph 67 which states “‘Rite Aid reasonably believed

that the ‘tax’ listed in the invoice reflected sales tax.’” Id. (record citations

omitted). Appellant asserts:

            The trust fund aspect of Stoloff is not one that arises from
      the pleadings, it arises from the statute.6 Pennsylvania[’s] sales
      tax statute provides that any tax collected under color of the law
      is held in trust for the Commonwealth.7 The under color of law
      portion of the statute is particularly relevant because, as the trial
      court recognized, “[Rite Aid] is seeking a refund from [Appellant]
      for charging [Rite Aid] a ‘tax’ disguised as a sales tax. To the
      extent there is a dispute over whether the “tax” is sales tax or
      something “disguised” as a sales tax and collected under color of
      the law, the dispute must be resolved by the taxing authorities.
      _______________________

         6 If Stoloff is only implicated when the complaint allege[s]
         the existence of a trust fund, a plaintiff could avoid Stoloff
         by simply omitting a trust fund allegation.

         7 72 P.S. § 7225 [(“All taxes collected by any person from
         purchasers in accordance with this article and all taxes
         collected by any person from purchasers under color of this
         article, including all taxes paid by any person who advertises
         or holds out or states, directly or indirectly, that such person
         will pay the tax for the purchaser, which have not been
         properly refunded by such person to the purchaser shall
         constitute a trust fund for the Commonwealth, and such

                                      -7-
J-A26035-21

         trust shall be enforceable against such person, his
         representatives and any person (other than a purchaser to
         whom a refund has been made properly) receiving any part
         of such fund without consideration, or knowing that the
         taxpayer is committing a breach of trust: Provided,
         however, That any person receiving payment of a lawful
         obligation of the taxpayer from such fund shall be presumed
         to have received the same in good faith and without any
         knowledge of the breach of trust. Any person, other than a
         taxpayer, against whom the department makes any claim
         under this section shall have the same right to petition and
         appeal as is given taxpayers by any provisions of this
         part.”)].

Appellant’s Brief at 6-7 (some footnotes omitted).

      Second, Appellant complains the court erred in determining that “the

expertise of the taxing authorities is not required because Rite Aid is not

seeking a refund, [or] seeking the interpretation of any taxing regulations or

challenging any assessment.”       Appellant’s Brief at 7 (footnote omitted).

Appellant maintains this position was addressed by the Stoloff Court and

rejected because “once the consumer pays the tax, that amount effectively

becomes Commonwealth property[, and] it does not matter whether the

complaint alleges the funds are held in trust or not” or “whether the ‘tax’ was

sales tax or something else.”     Appellant’s Brief at 7 (citation and internal

quotation marks omitted). Appellant postulates that the “point of Stoloff is

the plaintiff is required to first seek a refund from the taxing authorities.” Id.

      Based on this theory, Appellant asserts the doctrine of primary

jurisdiction is invoked and requires a stay of the proceedings on Rite Aid’s

complaint as the Department has jurisdiction over matters involving

                                      -8-
J-A26035-21

Pennsylvania sales tax. See Appellant’s Brief at 8-12. Appellant also suggests

that the issues in the case are “complex and require the specialized

competence of the taxing authorities.” Id. at 13. Likewise, Appellant states

that the matter should be stayed until the conclusion of any required

proceedings in sister state jurisdictions. See id. at 20-26. Lastly, Appellant

contends that it may be subject to inconsistent rulings and duplicative liability

if the proceedings are not stayed. Id. at 27-28.

      We begin with our standard of review in matters involving jurisdiction:

“[I]ssues concerning the jurisdiction of the trial court . . . present questions

of law and are subject to [a] de novo [standard of] review.” Stoloff, 24 A.3d

at 369 (citation omitted).

      [T]he doctrine of primary jurisdiction is concerned with promoting
      proper relationships between the courts and administrative
      agencies charged with particular regulatory duties. Primary
      jurisdiction applies where a claim is originally cognizable in the
      courts, and comes into play whenever enforcement of the claim
      requires the resolution of issues which, under a regulatory
      scheme, have been placed within the jurisdiction of an
      administrative body; in such a case the judicial process is
      suspended pending referral of such issues to the administrative
      body for its views.

Ciamaichelo v. Independence Blue Cross, 909 A.2d 1211, 1218 (Pa.

2006), citing Elkin v. Bell Telephone Company of Pennsylvania, 420

A.2d 371 (Pa. 1980).

            The doctrine serves several purposes, chief of which are the
      benefits to be derived by making use of the agency’s special
      experience and expertise in complex areas with which judges and
      juries have little familiarity. Another important consideration is
      the statutory purpose in the creation of the agency ─ the powers

                                      -9-
J-A26035-21

     granted by the legislature and the powers withheld. And, another
     fundamental concern is the need to promote consistency and
     uniformity in certain areas of administrative policy. . . .

            It is equally important to realize what the doctrine is not-it
     is not simply a polite gesture of deference to the agency seeking
     an advisory opinion wherein the court is free to ignore the
     agency’s determination. Rather, once the court properly refers a
     matter or a specific issue to the agency, that agency’s
     determination is binding upon the court and the parties (subject,
     of course, to appellate review through normal channels), and is
     not subject to collateral attack in the pending court proceeding.

                                 *     *      *

           We must enter a caveat, however. Courts should not be too
     hasty in referring a matter to an agency, or to develop a
     “dependence” on the agencies whenever a controversy remotely
     involves some issue falling arguably within the domain of the
     agency’s “expertise.” “Expertise” is no talisman dissolving a
     court’s jurisdiction.    Accommodation of the judicial and
     administrative functions does not mean abdication of judicial
     responsibility.   The figure of the so-called “expert” looms
     ominously over our society – too much so to permit the roles of
     the court and jury to be readily relinquished absent a true
     fostering of the purposes of the doctrine of primary jurisdiction.

            Therefore, where the subject matter is within an agency’s
     jurisdiction and where it is a complex matter requiring special
     competence, with which the judge or jury would not or could not
     be familiar, the proper procedure is for the court to refer the
     matter to the appropriate agency.          Also weighing in the
     consideration should be the need for uniformity and consistency
     in agency policy and the legislative intent. Where, on the other
     hand, the matter is not one peculiarly within the agency’s area of
     expertise, but is one which the courts or jury are equally well-
     suited to determine, the court must not abdicate its responsibility.
     In such cases, it would be wasteful to employ the bifurcated
     procedure of referral, as no appreciable benefits would be
     forthcoming.

Elkin, 420 A.2d at 376-77 (citations and footnotes omitted).

                                     - 10 -
J-A26035-21

       Lastly, “we look to the plaintiff’s allegations, not to the form of the

pleading or the cause(s) of action asserted, to determine whether the doctrine

of primary jurisdiction applies.” Erie Ins. Exch. V. Pa. Ins. Dep’t, 133 A.3d

102, 108 (Pa. Commw. 2016).5

       With these principles concerning the doctrine of primary jurisdiction in

mind, we now turn to the case relied on by Appellant, Stoloff. There, the

appellant-buyer filed a class action lawsuit against the appellee-department

store, which arose from her purchase-by-phone of a dress from the store’s

catalog, to which the appellee-department store added a 6% sales tax.

Stoloff, 24 A.3d at 368.

       In their complaint, [the a]ppellants insisted that [the appellee-
       department store] regularly required its Pennsylvania customers
       to pay a sales tax on clothing, even though most articles of
       clothing are not subject to the Pennsylvania tax. As a result, [the
       a]ppellants filed a class-action complaint against [the appellee-
       department store], alleging breach of contract, unjust enrichment,
       violation of the consumer protection law, and conversion, in
       addition to seeking injunctive relief.

Id. (footnote omitted).

       The appellee-department store filed preliminary objections claiming the

trial court lacked subject-matter jurisdiction. See Stoloff, 24 A.3d at 368.

Following a hearing on the matter, at which the court was in receipt of an

____________________________________________

5 We note we are not bound by the decisions of the Commonwealth Court.
IRS v. Blue Mountain Ministry, Inc., 265 A.3d 824, 828 n.3 (Pa. Super.
2021). Nevertheless, this decision is persuasive authority and helpful in our
review of the issue presented.

                                          - 11 -
J-A26035-21

advisory opinion by the Pennsylvania Department of Revenue, the trial court

determined the appellants did not exhaust their administrative remedies,

thereby depriving it of subject matter jurisdiction. See id. The appellants

filed an appeal, arguing that the court erroneously limited the scope of its

jurisdiction based on the following: (1) the Pennsylvania Supreme Court

provided broad jurisdiction to the trial courts; and (2) they were “not filing an

action against a government entity, but rather a private entity [and therefore,]

their claims were not subject to the statutes governing tax-refund claims from

this Commonwealth”. See id. at 368-69.

       In reversing the trial court’s decision, a panel of this Court held that any

dispute involving the payment of sales tax must first be resolved by the

Department and found the doctrine of primary jurisdiction applied,6 opining:

             [The a]ppellants rely on Section 7225 for the proposition
       that “private parties have a duty to refund improperly collected
       taxes,” and the apparent proposition that the Court of Common
       Pleas properly has primary jurisdiction in this case.        [The
       a]ppellant’s interpretation of Section 7225 is misplaced. Section
       7225 unambiguously states anyone who collects taxes that have
       not been properly refunded to a purchaser must hold such amount
       in a trust fund for the Commonwealth. 72 P.S. § 7225. This
       language does not elevate a purchaser to the status of a private
       party who may bypass administrative remedies. Reading Sections
       7225 and 7252 together, we determine that once a purchaser
       pays the seller a tax, whether properly or improperly imposed,
       that tax effectively becomes Commonwealth property, whether
       the seller transfers it to the Commonwealth or holds it in a trust
       fund for the Commonwealth. See 72 P.S. § 7225 (directing that
____________________________________________

6 In conjunction with determining the doctrine of primary jurisdiction applied,
the panel concluded the trial court erred in dismissing the complaint for lack
of subject matter jurisdiction. Stoloff, 24 A.3d at 368.

                                          - 12 -
J-A26035-21

      all taxes not transferred to the Commonwealth must be held in a
      trust fund); 72 P.S. § 7252 (stating that the Department shall
      refund all taxes paid improperly to the Commonwealth).
      Accordingly, even if [the appellee-department store] failed to
      forward the collected tax to the Commonwealth, it was required
      to hold, in a trust fund for the Commonwealth, any tax paid by a
      purchaser. See 72 P.S. § 7225. Alternatively, if [the appellee-
      department store] did forward the collected tax to the
      Commonwealth, then Sections 7252 and 7253 unambiguously
      dictate that Appellants must seek a remedy with the Department.
      See 72 P.S. §§ 7252, 7253.

              In either scenario, once the consumer pays the tax, that
      amount effectively becomes Commonwealth property.               The
      Department is thus in the best position to determine whether [the
      appellee-department store] appropriately taxed the instant
      consumers, as it customarily handles the overwhelming majority
      of, if not all, such claims. In fact, Section 7253 mandates that the
      Department cannot authorize a refund of improperly collected
      taxes unless the taxpayer has filed a petition for refund with the
      Department. See 72 P.S. § 7253(a).

            In light of the fact that the taxes paid by the instant
      consumers are currently in the Department’s possession, whether
      in actuality or in trust, we consider the issue of whether the tax
      was properly assessed to be within the Department’s jurisdiction
      and well-within its expertise.

Stoloff, 24 A.3d at 372-73 (footnotes and some citations omitted)).

      Turning to the present matter, the trial court first looked to the

allegations made in Rite Aid’s complaint, finding:

      [I]t is clear the doctrine of primary jurisdiction does not apply.
      [Rite Aid] brings this action against [Appellant] for breach of
      contract and fraud arising from [Appellant]’s alleged improper
      collection of a “tax” and its alleged false representation that the
      “tax” collected would be remitted to the proper authorities. There
      is no allegation or reasonable inference that can be drawn from
      the complaint that [Appellant] is holding the “tax” in trust for the
      Department or that the “tax” was a sales tax. In fact, it is alleged
      that [Appellant] is not licensed or registered with the Department
      and therefore could not remit the required sales tax charges.

                                     - 13 -
J-A26035-21

             This action was instituted by [Rite Aid] to recoup the
      allegedly unauthorized line item charge that [Appellant] imposed
      upon [Rite Aid].24 [Rite Aid] is not asking for the Department to
      assess sales or use tax on [it] or [Appellant]. The assessment has
      already been made by the Department since the “tax” charged on
      the invoice is not recognized as a sales tax by the Department.
      [Rite Aid] is not asking for a refund, asking an interpretation of
      any tax regulations nor challenging any tax assessment from the
      Department. [Rite Aid] is seeking recourse against [Appellant] for
      its allegedly improper actions independent of the Department’s
      role and on matters which are properly within the expertise of this
      court. Since the expertise of the Department is not implicated,
      the doctrine of primary jurisdiction does not apply.
      _______________________

         24  [Appellant] makes various statements regarding what
         the line item “tax” represents. [Appellant] stated that the
         “tax” listed on the invoice issued to Rite Aid “was not
         Pennsylvania sales tax paid by [Rite Aid] to [Appellant]” but
         rather was the reimbursement of the sales tax paid by
         [Appellant] to [its] own vendors and then passed onto [Rite
         Aid] as a cost of the goods sold to [Rite Aid].

Trial Ct. Op. at 6-7 (some footnotes and record citation omitted).

      The trial court further found that Stoloff was distinguishable from the

present matter, explaining:

      [Rite Aid] is not seeking a tax refund from the Department of
      Revenue or from an entity holding the tax in trust for the
      Department. [Rite Aid] is seeking a refund from [Appellant] for
      charging [it] a “tax” disguised as a sales tax. The Department of
      Revenue’s expertise is not required in this action and the doctrine
      of primary jurisdiction does not apply.

Trial Ct. Op. at 8.

      Based on the circumstances before us, we agree with the trial court that

the doctrine of primary jurisdiction is not applicable and Stoloff is

distinguishable from the present matter for several reasons. First, Appellant

                                    - 14 -
J-A26035-21

conflates that fact that this case touches upon the failure of a party to pay a

tax with the notion that any litigation, or even any allegation, related to a tax

issue must fall under the umbrella of the Department. Likewise, Appellant

repeatedly misconstrues Rite Aid’s cause of action as a mere refund for the

paid “taxes.” Rather, this matter concerns Rite Aid’s reliance on Appellant’s

statements that the taxes, which it listed on its invoices and requested Rite

Aid pay, was ostensibly being collected and forwarded to the Department for

tax purposes.    Rite Aid further alleged Appellant either fraudulently or

negligently mispresented this information because the money paid was never

deposited with the Department as a “tax.”

      This leads us to our second point. Appellant focuses on two paragraphs

of an 89-paragraph complaint to support its argument that Rite Aid did allege

in its complaint that (1) the “tax” at issue was a sales tax; and (2) that

Appellant was holding the tax in trust. Rather, when looking at the complaint

in toto, this was not the case. Rite Aid’s complaint focused on a fraudulent

scheme as directed by Appellants. It specifically alleged that Appellant issued

numerous invoices to Rite Aid, which included a line item charge for “tax” in

connection with Appellant’s work, which Rite Aid paid directly to Appellant.

Rite Aid’s Complaint at 2. Rite Aid then averred Appellant failed to remit that

money to the proper tax authorities in Pennsylvania.        See id.   It further

alleged:

      35. In 2019, in connection with a tax audit by the PA Department
      of Revenue, Rite Aid learned that [Appellant] had not remitted to

                                     - 15 -
J-A26035-21

     the PA Department of Revenue the taxes [Appellant] had collected
     from Rite Aid for work [Appellant] had performed in Pennsylvania.
     In fact, according to the PA Department of Revenue, [Appellant]
     was not registered with the PA Department of Revenue and did
     not have a Pennsylvania sales tax license, in violation of
     Pennsylvania law. Without a valid sales tax license, a vendor
     cannot remit the required sales tax charges, as required by
     Pennsylvania law.

     36. Because [Appellant] failed to remit the sales tax it collected,
     the PA Department of Revenue has informed Rite Aid that it is
     assessing a use tax on Rite Aid for its transactions with [Appellant]
     during the audit period.

     37. Upon learning that [Appellant] was not registered for sales
     tax with the PA Department of Revenue and had never remitted
     to the PA Department of Revenue the sales tax it had collected
     from Rite Aid in Pennsylvania, Rite Aid’s representatives
     attempted to contact [Appellant] on or about November 25, 2019,
     December 3, 2019, December 9, 2019, December 13, 2019 and
     January 3, 2020.

     38. After repeatedly failing to respond to Rite Aid’s attempts to
     get information about the sales tax collected by [Appellant], [its]
     representatives agreed to have a call with Rite Aid’s
     representatives on or about January 15, 2020.

     39. On the January 15, 2020 call, when Rite Aid’s representatives
     asked for information related to [Appellant’s] collection and
     remittance of sales tax in Pennsylvania, [Appellant’s]
     representatives ─ includ[ing] [Appellant’s] president Marty Brin ─
     refused to answer Rite Aid’s questions, claiming that they were
     waiting to hear from their accountants and attorneys.

     40. On or about January 23, 2020, Rite Aid’s representatives had
     another call with representatives of [Appellant], including Marty
     Brin and an attorney representing [Appellant]. On that call,
     [Appellant’s] representatives informed Rite Aid that [it] had not
     paid sales tax for work performed in Pennsylvania to the PA
     Department of Revenue or to the tax authorities in other states.
     Instead, [Appellant’s] representatives falsely claimed ─ in direct
     contradiction with the unequivocal language in [Appellant’s] own
     invoices and requirements in the Agreements between Rite Aid
     and [Appellant] ─ that the itemized “tax” listed on [its] invoices

                                    - 16 -
J-A26035-21

      was not actually a tax, but some other charge by [Appellant].
      Unsurprisingly, [Appellant] could not explain what the “tax”
      charges were.

      41. Based on [Appellant’s] representations on January 23, 2020
      that the itemized “tax” listed on [its] invoices was not actually a
      tax, [Appellant] has not remitted the tax it collected from Rite Aid
      to any state tax authorities and now falsely claims that the
      itemized “tax” on [its] invoices did not reflect a tax.

Id. at 7-9.

      Based on these averments, it is evident that Rite Aid was not merely

claiming the parties’ conflict involved a tax refund issue and that Appellant

had placed the paid taxes in a trust fund. It is clear Rite Aid was alleging

Appellant purportedly committed fraud or some other tortious action because

it had not remitted the taxes to Department that it collected from Rite Aid,

and that it could not even do so because it was not registered with Department

and did not have a Pennsylvania sales tax license. Furthermore, the complaint

also indicated that Appellant had subsequently changed its position and was

now alleging that the itemized “tax” listed on the invoices was not actually a

tax, but rather, some other charge. Accordingly, Appellant’s argument has no

merit.

      Moreover, Appellant’s reliance as Stoloff is misplaced for several

reasons. One, the appeal issue does not concern a request for a refund of

taxes already paid to the Department. Two, the appellants in Stoloff never

asserted that the appellee-department store did not keep the taxes at issue

in a trust fund for tax purposes as is the case here. Three, the appellants did

                                     - 17 -
J-A26035-21

not set forth causes of action for fraud and negligent misrepresentation like

Rite Aid did in its complaint. Lastly, in its brief, Appellant does not allege the

money collected is being kept in a trust fund for tax purposes in accordance

with the Sections 7225 and 7252. Therefore, contrary to Appellant’s argument

Stoloff is not controlling in this appeal.

      In sum, we conclude the trial court did not err in denying its motion to

stay proceedings concerning Rite Aid’s complaint, or in the alternative, for a

protective order to limit discovery, as it had jurisdiction to review the matter.

      Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 3/8/2022

                                      - 18 -