Court Opinion

ID: 3152838
Source: CourtListenerOpinion
Date Created: 2015-11-06 20:06:59.902606+00
Date Added: 2024-06-11T11:57:39.990680
License: Public Domain

J. A26005/15

NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P. 65.37

JOSEPH GORZKOWSKI,                     :     IN THE SUPERIOR COURT OF
                                       :           PENNSYLVANIA
                          Appellant    :
                                       :
                     v.                :          No. 163 MDA 2015
                                       :
MODERN GAS SALES, INC.                 :

            Appeal from the Order Entered December 18, 2014,
             in the Court of Common Pleas of Luzerne County
                     Civil Division at No. 14465 of 2013

BEFORE: FORD ELLIOTT, P.J.E., WECHT AND PLATT,* JJ.

MEMORANDUM BY FORD ELLIOTT, P.J.E.:           FILED NOVEMBER 06, 2015

      Joseph Gorzkowski (“Gorzkowski”) appeals from the order entered

December 18, 2014, sustaining defendant/appellee, Modern Gas Sales,

Inc.’s (“Modern Gas”) preliminary objection in the nature of a demurrer and

dismissing Gorzkowski’s complaint in declaratory judgment.      After careful

review, we affirm.

      In a prior decision of this court, Linda Herman v. Berwick Gas

Sales, Inc. and Joseph Gorzkowski, 984 A.2d 1027 (Pa.Super. 2009),

appeal denied, 991 A.2d 313 (Pa. 2010), we summarized the history of

this matter as follows:

                   Appellant/plaintiff below     [Linda   Herman
            (“Herman”)]          and       Appellee        Joseph
            Gorzkowski/defendant[Footnote       1]    below   are
            siblings[Footnote 2] who since the late 1970’s were
            involved with their father in three family businesses

* Retired Senior Judge assigned to the Superior Court.
J. A26005/15

          selling propane gas and propane related products.
          In 1986, after the parties’ mother instituted divorce
          proceedings against their father, he, [Herman], and
          [Gorzkowski] agreed to issue backdated stock
          certificates in all three businesses to decrease the
          father’s apparent ownership interest, thus protecting
          it from exposure to economic claims related to the
          divorce. Pursuant to this objective, the certificates in
          Appellee Berwick, the only one of the businesses
          involved in this appeal, were allocated as 45 shares
          to [Gorzkowski], 30 to [Herman], and 25 to the
          father. The parties’ parents eventually reconciled,
          and an oral agreement to return to the father or
          destroy all the certificates was never executed even
          when, in the early 1990’s demand was made to the
          parties by their father.[Footnote 3] Their refusal was
          met by a complaint alleging a conspiracy to defraud
          filed against the parties and their father by the
          parties’ mother and another sibling who had been
          involved in the businesses, and who alleged that
          they were being deprived of their interests.

                [Footnote 1] The singular is used to
                indicate both Appellees.

                [Footnote 2] There are three other
                siblings only one of whom is involved in
                this matter, and that tangentially.

                [Footnote 3] [Gorzkowski] disputed the
                existence of any such agreement.

                In the settlement of that litigation, eventually
          reached in March of 1998, the parties to the instant
          matter were given full ownership of Appellee Berwick
          as well as identical cash payments of $546,600.
          From that point until 2003, the parties ran the
          business together, with [Gorzkowski] serving as
          president of the company and [Herman] as vice
          president, secretary, and treasurer, each receiving
          the same weekly salary and benefit package. In
          1999 the parties elected to alter the status of their
          company     from    a   “C”   corporation     to   an
          “S” corporation. Both the application for “S” status

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          and the company tax returns from 1998 to 2001
          describe them as 50% shareholders.

                 In early 2003, however, [Herman] and her
          husband became involved in divorce proceedings, in
          the course of which [Herman]’s husband requested
          production of the company’s financial records.
          Operating on the notion that using the stock
          certificates to indicate [Herman] had only a
          30% interest would alleviate the necessity for
          production     of   the     requested    documents,
          [Gorzkowski] instructed her to do so, and thereafter
          began relying on the certificates as support for his
          claim to be a 45% shareholder. The professional
          relationship between the parties, who had worked
          together amicably for over 25 years, began to
          deteriorate at about this time, to the extent that in
          May of 2003, [Gorzkowski] in his capacity as
          president of the company terminated [Herman]’s
          employment and that of her daughter who also
          worked at Appellee Berwick.

                 In March of 2003, [Herman] instituted the
          instant   declaratory    judgment    action    against
          [Gorzkowski] seeking a determination that she is a
          50% shareholder, and, at the same time, filed a
          petition for injunctive relief from [Gorzkowski]’s
          exclusion of her from the company. After a hearing
          on the latter, [Gorzkowski] appealed the trial court’s
          entry of a preliminary injunction against him, and its
          finding that [Herman] had established the likelihood
          that she owned 50% of Berwick.             This Court
          affirmed. Herman v. Berwick Gas Sales, Inc. and
          Joseph Gorzkowski, Nos. 927, 1061, 1062 MDA
          2003, unpublished memorandum (Pa.Super. filed
          October 19, 2004).

                  In November of 2005, [Gorzkowski] moved for
          summary judgment in the declaratory judgment
          action on grounds that the 1998 settlement and
          accompanying release which ended the familial
          litigation constituted unassailable res judicata,
          establishing [Herman]’s interest as 30% of
          Appellee Berwick per the stock certificates issued

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J. A26005/15

              during the divorce litigation of the parties’ parents in
              1986. After a hearing, the trial court agreed, and
              this appeal followed.

Herman v. Berwick Gas Sales, et al., No. 1220 MDA 2008, unpublished

memorandum at 1-4 (Pa.Super. filed July 15, 2009). On appeal, this court

found the backdated stock certificates to be invalid, and the effects of the

1998 settlement documents on the parties’ ownership interests in Berwick to

be nugatory. Id. at 7. We reversed the order of summary judgment and

remanded for further proceedings.

      On December 23, 2013, Gorzkowski brought the instant declaratory

judgment action, seeking a determination that if the 1998 settlement

agreement is invalidated, then he continues as an owner of 40 shares of

Modern Gas. Gorzkowski alleges that if the stock certificates were invalid at

the time of prior settlement, then neither he nor Herman ever relinquished

their ownership interests in Modern Gas.         Gorzkowski filed an amended

complaint on February 21, 2014, and Modern Gas filed preliminary

objections to the amended complaint on March 13, 2014. On December 18,

2014, the trial court sustained Modern Gas’s preliminary objection in the

nature of a demurrer and dismissed the complaint. A timely notice of appeal

was   filed    on    January    16,   2015.       Gorzkowski     complied   with

Pa.R.A.P. 1925(b), and the trial court has filed an opinion.

      Gorzkowski has raised the following issue for this court’s review:

              Did the court err in granting demurrer against
              declaratory judgment action based on the conclusion

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            that the action was based on events that may never
            occur?

Gorzkowski’s brief at 4.

            Our scope of review is plenary when reviewing a trial
            court’s order sustaining preliminary objections in the
            nature of a demurrer. See Glassmere Fuel Serv.,
            Inc. v. Clear, 900 A.2d 398, 401 (Pa.Super. 2006).
            “In order to determine whether the trial court
            properly sustained Appellee’s preliminary objections,
            this court must consider as true all of the
            well-pleaded material facts set forth in the complaint
            and all reasonable inferences that may be drawn
            from those facts.”     Id. at 402.      In conducting
            appellate review, preliminary objections may be
            sustained by the trial court only if the case is free
            and clear of doubt. See Knight v. Northwest Sav.
            Bank, 747 A.2d 384, 386 (Pa.Super. 2000).

Wheeler v. Nationwide Mut. Fire Ins. Co., 905 A.2d 504, 505 (Pa.Super.

2006), appeal denied, 916 A.2d 1103 (Pa. 2007).

      First, we must determine whether we have jurisdiction over this

matter. In his complaint, Gorzkowski alleges that,

            if Herman succeeds, under docket number 48-E of
            2003, in establishing invalidity of the subject stock
            certificates in her effort to claim 50% ownership in
            Berwick Gas Sales, Inc., she necessarily nullifies
            Joseph Gorzkowski’s relinquishment of ownership
            interests in Modern Gas Sales, Inc., and that as a
            result, Joseph Gorzkowski continues as an owner of
            40 shares of Modern Gas Sales, Inc.

Gorzkowski’s amended complaint, 2/21/14 at 3; RR at 43. The trial court

granted Modern Gas’s preliminary objections on the basis that there is no

actual controversy.   Gorzkowski is essentially seeking an advisory opinion

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J. A26005/15

dependent upon a ruling in his favor in the Second Litigation, to which

Modern Gas was not a party.

     “Declaratory relief is not available unless an actual controversy exists

or is imminent or inevitable.   Declaratory judgment is not appropriate to

determine rights in anticipation of events that may never occur, but is

appropriate where there is imminent and inevitable litigation.”     Boyle v.

Com., Dep’t of Transp., 617 A.2d 70, 72 (Pa.Cmwlth. 1992), citing

Pennsylvania Turnpike Commission v. Hafer, 597 A.2d 754 (Pa.Cmwlth.

1991).

           [W]e do not have the ability to grant any relief that
           is merely advisory, one that does not involve any
           case or controversy.      Any action, including a
           declaratory judgment action, may not be employed
           to determine rights in anticipation of events which
           may never occur or for consideration of moot cases
           or as a medium for the rendition of an advisory
           opinion which may prove to be purely academic.

Brown v. Com., Liquor Control Board, 673 A.2d 21, 23 (Pa.Cmwlth.

1996), appeal denied, 683 A.2d 886 (Pa. 1996) (citation omitted). “When

the matter does not present a case or controversy, the courts have

consistently held that they were without jurisdiction to hear the matter.” Id.

See also McCandless Twp. v. Wylie, 100 A.2d 590, 592 (Pa. 1953) (“We

have held that a declaratory judgment will not be rendered to decide future

rights in anticipation of an event which may never happen and that a

petition for declaratory judgment is properly dismissed where the proceeding

may prove to be merely academic.”) (citation omitted).

                                    -6-
J. A26005/15

      Instantly, we agree with the trial court that the matter is not ripe for

judicial determination and Gorzkowski lacks standing to maintain the action.

As the trial court cogently observes,

            In the case pending before us, [Gorzkowski] is
            asking for a determination of rights in anticipation of
            events that may never occur.            He seeks a
            declaratory judgment to establish his rights if, and
            only if, he is unsuccessful in the separate, Second
            Litigation and if the result in the separate, Second
            Litigation undermines the settlement in the First
            Litigation.

Trial court opinion, 4/16/15 at 5-6.

            Defendant Modern Gas was not a party to that
            action, and an analysis as to the way that
            corporation is run was never addressed by the
            Superior Court.    What effect the Superior Court
            decision in the Second Litigation has on the outcome
            of the ownership interests of Berwick Gas has yet to
            be determined, and may not have any impact on
            Modern Gas at all.

Id. at 6.   We agree.     As the Berwick Gas case is still being litigated,

Gorzkowski’s claim is predicated upon future rulings of the trial court, and he

is effectively seeking an advisory opinion in anticipation of events that may

or may not occur.     Gorzkowski continues to maintain, in the underlying

litigation, that he is majority owner of Berwick Gas. (Amended complaint,

2/21/14 ¶ 8.)    Gorzkowski merely speculates that final disposition in the

Second Litigation will undermine the 1998 settlement and therefore nullify

his relinquishment of 40 shares of Modern Gas. As such, there is no actual

                                        -7-
J. A26005/15

controversy and Gorzkowski lacks standing to bring this action in declaratory

judgment.

     Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 11/6/2015

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