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Vacant Property is Irredeemable after Sheriff Sale, Commonwealth Court Rules

If one wishes to take advantage of his right to redeem a piece of real estate subsequent to a sheriff’s sale, it is critical to act in a timely manner, otherwise one may miss the opportunity to do so.

53 P.S. Section 7293 lays out the time line to take action in redeeming a property; however, there was some ambiguity in precisely interpreting just when the deadlines occur. The Court, in the recent matter, and case of first impression, Brentwood Borough School District v. HSBC Bank USA, 111 A.3d 807, helped clarify some of the aforesaid ambiguity.

In Brentwood, Defendant HSBC is the mortgagee on a property which was sold at sheriff’s sale to a third party called Grove Properties, Inc. due to delinquent taxes. Within about five months, HSBC filed to redeem the property pursuant to 53 P.S. Section 7293(a). According to 53 P.S. Section 7293(a), a party must file to redeem a property within nine months from the date of the acknowledgment of the Sheriff’s Deed which conveys a property following a sheriff’s sale.  The trial court ruled against HSBC on this issue, asserting that HSBC only had ninety days to file to redeem, however on appeal the Commonwealth Court realized the trial court mistakenly applied the time line laid out in 53 P.S. Sections 27101-27605, and reversed the ruling of the trial court and confirmed the nine month time period.

The primary issue the Court focused upon was whether the property was vacant pursuant to 53 P.S. Section 7293(c), which made the case one of first impression. Section 7293(c) states that “there shall be no right of redemption of vacant property by any person after the date of the acknowledgment of the sheriff’s deed therefor.” Defendant argued that the property was not vacant because the occupant of the property at issue only temporarily stayed at her friends’ house to save money. She also left her belongings at the subject property. Based on the above, the Defendant asserted that, at most, the occupant of the property was only temporarily absent from it, which does not constitute its vacancy, as a property cannot be vacant if its occupant intends to return. In support of its argument, Defendant cited to how the term “occupied” is used in other cases and statutes.

The Court ruled that the term “occupied” must first be interpreted in the context of the Municipal Claims and Tax Liens statute (i.e.: 53 P.S. Section 7101 et seq). Pursuant to that statute the occupancy must be as a residence and not as a storage unit. Per the Court, the purpose of the statute is to increase the collection of taxes and to free land to bear its share of the tax burden. As a result, the Court reasoned, the statute must be interpreted to take consideration of the ability of the municipality to convert a house sold at sheriff’s sale back to productive use as quickly as possible.  Therefore, the Court deduced that the legislature intended the redemption period should be brief which, in this case, is nine months’ time.

The Court observed that “occupied” is a factual determination to be made and applied on a case-by-case basis. The factors to consider in looking at a case include: “whether anyone was habitually physically present at the property, i.e., regularly sleeping and eating there and using it as a place to dwell; whether any lack of physical presence was due to temporary illness, travel or renovation; whether the property was unsecured, damaged or uninhabitable; and whether the basic and necessary utilities such as water, electric and gas were operational.” The instant matter revealed a property which had no person habitually present in it before the sale. It had no running hot water or gas and, therefore, no means to bathe or cook, essentially making it uninhabitable.  Further, it also revealed that the occupant simply could not afford to reside at the property any longer. As a result, the Court resolved that the property was unoccupied. As the property was unoccupied, Defendant could not redeem the property after the date of the acknowledgment of the sheriff’s deed under the statute.

In light of the above, Defendant argued that disallowing them from redeeming the property was unjust as it “could not reasonably be deemed to be on notice that while [the occupant] kept all her belongings at the Property and frequently returned to the Property that she would later claim that she did not reside there anymore, and Defendant would suddenly be precluded from redeeming its interest in the Property.” The Court was not convinced. The Court was satisfied that the Defendant received all required statutory notices under the applicable law.

In sum, the Court ruled that the statute at issue is designed for a speedy and efficient process to return a property sold at sheriff’s sale to productive use and a property with no working utilities and no one physically inhabiting the property is vacant (or unoccupied) despite the occupant’s intention to move back in or leaving her belongings in the property.

Originally published on October 3, 2017 in Upon Further Review and can be viewed here.

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Redemption Available Immediately After a Sheriff’s Sale

In the recent matter of City of Philadelphia v. F.A. Realty Investors Corp., 95 A.3d 377 (Pa.Cmwlth.2014), the Court had the opportunity to tackle a matter of first impression when interpreting 53 P.S. Section 7293 with regard to when a property owner may redeem his property after a sheriff’s sale.

In F.A., the piece of real estate at issue (“the Property”) was subject to a tax delinquency which led to an order by the trial court to sell the Property at a sheriff’s sale in order to satisfy the aforesaid tax delinquency. Not long after the order was entered, the Property was sold at sheriff’s sale. Immediately after the sale, Defendant filed to redeem the Property, but its petition to do so was dismissed by the trial court.

According to 53 P.S. 7293, a property owner may redeem a property sold at sheriff’s sale “at any time within nine months from the date of the acknowledgment of the sheriff’s deed therefore, upon payment of the amount bid at such sale.” The City of Philadelphia argued that Defendant’s immediate action to redeem the Property was premature as it acted prior to the acknowledgment of the deed. The trial court agreed with the City’s interpretation and application of the statute when it dismissed Defendant’s petition.

When interpreting the statute cited above, the Court first noted that, per 1 Pa.C.S. Sections 1921 and 1922, and the cases decided thereunder, statutory construction ought not lead to an absurd result, and when there is ambiguity in the language of a statute, the court may look to the intent of the legislature to help provide interpretive guidance. The Court also explained that the redemption statute is to be liberally construed in order to effect justice, pointing out that the purpose of sheriffs’ sales is not to strip a property owner of his real estate, but simply to collect on municipal claims.

Defendant argued that making them wait until the sheriff’s deed is acknowledged would likely, and unjustly, lead to unnecessary additional fees, costs, taxes, and/or interest and, therefore, its prompt action could avoid these costs.

The Court observed that the applicable statute has at least two interpretations. The first being that the phrase “at any time” literally means at any time, without regard to when the acknowledgment occurs, as long as it is within the nine month time frame. The second interpretation begins the nine month period for redemption at the time of acknowledgment.

As the language is, in the Court’s view, ambiguous, it looked to legislative intent and, on that basis concluded that the legislature would not try and increase a property owner’s difficulty to redeem property. Indeed, a property owner may retain possession of a house sold at sheriff’s sale until the sale is completed by the acknowledgment and delivery of the deed obtained at the sale. As a result, the Court believed it would be an absurd result to disallow a property owner from redeeming his property while he is in possession of it simply because the deed had technically not been acknowledged.

Finally, Pennsylvania law prohibits the redemption of a vacant property after the date of acknowledgment. In light of the above, namely that absurd results are to be avoided and that the purpose of sheriffs’ sales is not to strip someone of his property but merely to ensure municipal claims are satisfied, it would seem that the City of Philadelphia’s arguments would disallow someone from redeeming a vacant property at all. In other words, if a property is vacant, an owner cannot redeem it after acknowledgment and, if the City’s interpretation of 53 P.S. 7293 is correct, he would not be able to redeem it before either, and this would be an absurd result, not to mention an unjust one, preventing an owner from redeeming his property.

So, in sum, in light of the above, and after review of the applicable statutes, the Court ruled that a property owner can redeem his property sold at sheriff’s sale at any time up to nine months after acknowledgment of the sale.

Originally published in Upon Further Review on June 7, 2017 and can be found here.

Redemption Available Immediately After a Sheriff’s Sale

In the recent matter of City of Philadelphia v. F.A. Realty Investors Corp., 95 A.3d 377 (Pa.Cmwlth.2014), the Court had the opportunity to tackle a matter of first impression when interpreting 53 P.S. Section 7293 with regard to when a property owner may redeem his property after a sheriff’s sale.

In F.A., the piece of real estate at issue (“the Property”) was subject to a tax delinquency which led to an order by the trial court to sell the Property at a sheriff’s sale in order to satisfy the aforesaid tax delinquency. Not long after the order was entered, the Property was sold at sheriff’s sale. Immediately after the sale, Defendant filed to redeem the Property, but its petition to do so was dismissed by the trial court.

According to 53 P.S. 7293, a property owner may redeem a property sold at sheriff’s sale “at any time within nine months from the date of the acknowledgment of the sheriff’s deed therefore, upon payment of the amount bid at such sale.” The City of Philadelphia argued that Defendant’s immediate action to redeem the Property was premature as it acted prior to the acknowledgment of the deed. The trial court agreed with the City’s interpretation and application of the statute when it dismissed Defendant’s petition.

When interpreting the statute cited above, the Court first noted that, per 1 Pa.C.S. Sections 1921 and 1922, and the cases decided thereunder, statutory construction ought not lead to an absurd result, and when there is ambiguity in the language of a statute, the court may look to the intent of the legislature to help provide interpretive guidance. The Court also explained that the redemption statute is to be liberally construed in order to effect justice, pointing out that the purpose of sheriffs’ sales is not to strip a property owner of his real estate, but simply to collect on municipal claims.

Defendant argued that making them wait until the sheriff’s deed is acknowledged would likely, and unjustly, lead to unnecessary additional fees, costs, taxes, and/or interest and, therefore, its prompt action could avoid these costs.

The Court observed that the applicable statute has at least two interpretations. The first being that the phrase “at any time” literally means at any time, without regard to when the acknowledgment occurs, as long as it is within the nine month time frame. The second interpretation begins the nine month period for redemption at the time of acknowledgment.

As the language is, in the Court’s view, ambiguous, it looked to legislative intent and, on that basis concluded that the legislature would not try and increase a property owner’s difficulty to redeem property. Indeed, a property owner may retain possession of a house sold at sheriff’s sale until the sale is completed by the acknowledgment and delivery of the deed obtained at the sale. As a result, the Court believed it would be an absurd result to disallow a property owner from redeeming his property while he is in possession of it simply because the deed had technically not been acknowledged.

Finally, Pennsylvania law prohibits the redemption of a vacant property after the date of acknowledgment. In light of the above, namely that absurd results are to be avoided and that the purpose of sheriffs’ sales is not to strip someone of his property but merely to ensure municipal claims are satisfied, it would seem that the City of Philadelphia’s arguments would disallow someone from redeeming a vacant property at all. In other words, if a property is vacant, an owner cannot redeem it after acknowledgment and, if the City’s interpretation of 53 P.S. 7293 is correct, he would not be able to redeem it before either, and this would be an absurd result, not to mention an unjust one, preventing an owner from redeeming his property.

So, in sum, in light of the above, and after review of the applicable statutes, the Court ruled that a property owner can redeem his property sold at sheriff’s sale at any time up to nine months after acknowledgment of the sale.

Originally published in Upon Further Review” June 7, 2017 and can be seen here.

The Gist of a Legal Malpractice Action

There are times when a disgruntled client believes his case was mishandled by his attorney to such an extent that he needs to bring suit against the attorney to make him whole. When bringing such a suit, a client can bring an action against his attorney sounding in tort for legal malpractice and/or an action sounding in breach of contract.

A malpractice claim addresses whether an attorney performed his duties according to the accepted standards of practice and is subject to a two year statute of limitations. A breach of contract claim addresses whether the attorney fulfilled his duties according to the contract that an attorney has with his client and is subject to a four year statute of limitations. According to the so-called “gist-of-the-action” rule, a litigant may not bring a tort claim (e.g.: legal malpractice) against someone if the legal duty that is claimed to have been breached by the opposing party is created by the terms of a contract.

It is not uncommon for both legal malpractice and breach of contract claims to be raised simultaneously by disgruntled clients against their attorneys, and the recent matter of New York Central Mutual Insurance Company and St. Paul Mercury Insurance Company v. Margolis Edelstein and Michael T. Savitsky, United States Court of Appeals for the Third Circuit, Case No. 15-1541 helps provide guidance regarding which is the more appropriate claim.

The New York Central matter centered on an attorney’s representation of an automobile insurance company with regard to the coverage it elected to provide (or lack thereof) for an automobile accident. At the conclusion of the case, the insurance company believed it received poor, indeed substandard, legal advice from its attorney which, as a result, led to its suing its attorney for breach of contract. The defendant attorney filed a motion to dismiss (which was granted, leading the insurance company to appeal to the Third Circuit) based on the “gist-of-the-action” rule. The successful argument proffered by the attorney was that, regardless of the labeling provided by the insurance company, its claim was actually a malpractice claim. The impact of a breach of contract claim being construed as a malpractice claim is that it shortens the applicable statute of limitations from four years (for contracts) to two years (for torts), which would lead to the dismissal of the insurance company’s claims as they were filed more than two years after the incident giving rise to its case against its attorney.

The Court indicated that a claim for breach of contract must arise from the duties created by a contract and not duties created through a “broader social duty.” The duty at issue under a contract claim must be one which a party would not otherwise have been obliged to do but for the terms of the contract.

According to the Court, the obligation for an attorney to perform his duties competently is one which looks to “broader social duties” and not simply the specific terms of a contract. According to the contract at issue, the attorney in this case was tasked with researching, drafting, and communicating a legal opinion to the insurance company regarding exposure to civil liability flowing from a specific automobile accident. To that end, the Court observed that the attorney did research, draft, and communicate the aforesaid legal opinion to the insurance company. Consequently, the attorney did not breach the contract. The insurance company’s claim is, more-or-less, that the attorney did a poor job in researching, drafting, and communicating the legal opinion, which is distinct from claiming the attorney did not perform the tasks he was contracted to do. In other words, as the Court pointed out, the insurance company’s claim “arises from [the attorney’s] negligent performance of his contractual duty obligations and, therefore, sounds in tort.”

Due to the above, the Court construed the breach of contract claim against the attorney as a malpractice claim, and, therefore, applied the two year statute of limitations for a malpractice claim to the insurance company’s claims, which resulted in the dismissal of those claims due to being time barred.

The decision above is beginning to be adopted generally as it has already been applied in the matter of Rinker v. Amori, Case No.: 3:15-1293, 2016 US Dist. Lexis 36712 at 19-20 (M.D. Pa. Mar. 22, 2016) and is consistent with the Pennsylvania Supreme Court case Bruno v. Erie Insurance, 106 A.3d 48 (Pa. 2014).

So, practitioners should be aware and vigilant to ensure they are compliant with the “gist-of-the-action” rule, and remember that, regardless of how a case is labeled, a court will look to the substance of the claims made to determine whether it sounds in contract or in tort.

Originally published on September 26, 2016 in Upon Further Review and can be seen here.

Lacking of Specificity About Specificity

F.R.C.P 8(a) and 8(c) requires so-called notice pleading for the claims made in pleadings. Notice pleading requires a party to plead with specificity sufficient to give an opposing party notice of what the claim(s) being made are. A question has arisen in federal court as to whether affirmative defenses, a type of pleading typically filed by a defendant against a plaintiff’s complaint, need to meet the specificity requirement mentioned above.

The U.S. Supreme Court, in the matters of Bell Atlantic Corporation v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), appeared to create new pleading standards; however their application to affirmative defenses is unclear.

The matter of Tyco Fire Products v. Victaulic, 777 F.Supp.2d. 893 (E.D.Pa.2011), in the Eastern District of Pennsylvania attempts to address the ongoing development of the pleading requirements for affirmative defenses.

As is typical, the defendant in Tyco filed a list of affirmative defenses in conclusory form responding to various legal claims. The plaintiff, in response, filed a motion to dismiss the affirmative defenses on the basis that they lacked the necessary specificity per the rules cited above.

When analyzing the arguments presented pursuant to the aforesaid motion, the court noted that F.R.C.P. 8(a) does not apply to affirmative defenses as, per this court, they are dealt with by F.R.C.P. 8(c). Prior to Twombly, affirmative defenses would only be stricken if no set of facts could be inferred to support them. Since the Twombly decision, some say the pleading requirements have risen to something above a speculative level and/or a formulaic recitation of labels or conclusions, and some sort of factual allegations are now required.

In light of the above, the court pointed out that lower courts across the country are divided as to how these Supreme Court cases apply to affirmative defenses; indeed, the court noted, many courts have taken the position that these cases do not apply to affirmative defenses. Significantly, some courts have recognized that as the Supreme Court only interpreted F.R.C.P. 8(a), and not 8(c), there should be no change to the application of 8(c) to affirmative defenses. By contrast, other courts interpret the applicable law as having always required fair notice for all pleadings, including even affirmative defenses.

The U.S. District Court of the Eastern District of Pennsylvania, in Tyco, was more persuaded by the argument that as the Supreme Court interpreted 8(a) and 8(c) differently, affirmative defenses do not require the specificity of other pleadings and need not be plausible to survive. Affirmative defenses need only to provide fair notice of the issues and arguments raised without the specificity required in other sorts of pleadings like complaints and counterclaims. The court argued that it would only strike affirmative defenses challenged on the basis of specificity only if they cannot meet this very low standard, which it believes is consistent with the language of 8(c). Indeed, the court observed that its interpretation is consistent with the fact that no responsive pleading to affirmative defenses is legally or procedurally required. Further, requiring greater specificity imposes an unreasonable burden on parties who risk waiving the defenses they do not raise at the pleading phase due to having insufficient information to raise them as affirmative defenses at the time of filing.

The court admitted that this area of the law, namely the interpretation of F.R.C.P. 8(a) and (c) relative to affirmative defenses, is still very fluid and variable. As a result, it is important for the practitioner to ensure he is familiar with the prevailing interpretation when filing affirmative defenses.

Originally published in The Legal Intelligencer Blog on August 5, 2016 and can be seen here.

Federal Courts Interpret Federal Law Even in State Court

In the matter of James v. City of Boise, Idaho (136 S.Ct. 685 (2016)), the Supreme Court of the United States has clarified for all state courts, including Pennsylvania, who/what has the ultimate authority, and indeed the jurisdiction, to interpret and apply federal law.

 

The Plaintiff in the James matter filed a claim under 42 U.S.C. Section 1983 against the city of Boise and some of its police officers after she was bitten by one of their police dogs while they were responding to a burglary call.

 

Plaintiff brought suit in her local state trial court.  Plaintiff was unsuccessful at trial which led to her appealing the matter all the way to Idaho’s Supreme Court.  The Idaho Supreme Court affirmed the dismissal of Plaintiff’s case and awarded the Defendants appellate attorneys’ fees.  Plaintiff again appealed, this time to the Supreme Court of the United States.

 

Pursuant to 42 U.S.C. Section 1983, the court may elect to award reasonable attorneys’ fees to a prevailing party in a civil rights law suit.  The United States Supreme Court, in the matter of Hughes v. Rowe, 449 U.S. 5 (1980), interpreted 42 U.S.C. Section 1988 to allow attorneys’ fees to be assessed only if the underlying action was frivolous, unreasonable, or without foundation.

 

When deciding the James case, the Idaho Supreme Court decided, unilaterally, that it was not bound by United States Supreme Court’s interpretation of 42 U.S.C. Section 1988 as enunciated in the Hughes matter.  The logic employed by the Idaho Supreme Court led it to conclude that while the United States Supreme Court can determine how federal courts can assess attorneys’ fees, it has no authority to do so for state courts such as the Idaho Supreme Court.  As a result, the Idaho Supreme Court ruled that it, and/or its lower courts, could assess attorneys’ fees without a prior determination of whether the underlying matter was frivolous, unreasonable, or without foundation.

 

Upon review of the Idaho Supreme Court, the United States Supreme Court, in no uncertain terms, reversed the Idaho Supreme Court, indicating that federal statutes are definitively interpreted by federal courts, with the Supreme Court, of course, being the ultimate authoritative federal court, and those interpretations, must be respected by state courts.

 

In support of its decision, the United States Supreme Court went back to 1816 in citing Justice Story in Martin v. Hunter’s Lessee, 1 Wheat. 304, 348 when he ruled “the laws, the treaties, and the constitution of the United State would be different in different states, and might, perhaps, never have precisely the same construction, obligation, or efficacy, in any two states.  The public mischiefs that would attend such a state of things would be truly deplorable.”

 

In short, the Idaho courts, or the courts of any state including those in Pennsylvania, are bound by the United States Supreme Court’s interpretation of federal law regardless of whether the underlying matter is a state case or in state court.

Originally published in The Legal Intelligencer Blog on April 7, 2016 and can be seen here.

Fallout for Injuries Sustained by Contractor’s Employee

When construction is taking place on a piece of real estate, and an employee of the contractor doing the work is injured there, who bears the potential tort liability for the injury, the property owner, the general contractor, or both?  Luckily Pennsylvania law provides a way to discern how liability should be distributed if there is no existing contract between the contractor and property owner which addresses the liability question.

The basic legal principle is foundational, well established, and has manifold case support in Pennsylvania.  The standard of care present in such a case mirrors the standard of care a property owner has to an individual on the property owner’s land.  The standard of care a property owner has depends upon whether the individual on the property owner’s land is a trespasser, licensee, or invitee.  Under Pennsylvania law, the employee of a general contractor who is authorized to be on the property falls within the classification of business invitee, and therefore, the duty of care owed to a business invitee is the highest duty owed to any entrant upon the property.

Pennsylvania “case law sets forth the duty that a possessor of law owes to business invitees as follows:  A possessor of land is subject to liability for physical harm caused to his invitees by a condition on the land if, and only if, he (a) knows or by the exercise of reasonable care would discover the condition, and should realize that it involves an unreasonable risk of harm to such invitees, and (b) should expect that they will not discover or realize the danger, or will fail to protect themselves against it, and (c) fails to exercise reasonable care to protect them against the danger.”  Chenot v. A.P. Green Services, Inc., et al., 2006 Pa.Super. 52, 63 (2006)  Therefore, a property owner is potentially liable for the injuries sustained by a contractor’s employee while on the property.

In addition, there is no doubt that a duty of care attaches to a contractor for the injuries sustained by its employees.  Suffice it to say, a contractor has a duty, for which it can be held liable if breached, for injuries sustained by its employees while they are engaged in working for the contractor at the property.  However, the duty of care applied to a contractor does not lessen or relieve the property owner of his/her/its duty of care over business invitees/visitors.  Despite a contractor’s duty of care, a property owner “must [still] protect an invitee not only against known dangers, but also against those which might be discovered with reasonable care.” The court in  Gutteridge v. A.P. Green Services Inc., A.W. et al., 804 A.2d 643, 657 (Pa. Super. 2002) stated that a property owner ‘“owes a duty to warn an unknowing contractor of existing dangerous conditions on the landowner’s premises where such conditions are known or discoverable to the owner.”’  Finally, it should also be noted that the property owner’s duty to warn remains regardless of whether a contractor ‘“exercises full control over the work and premises entrusted to him.’”  (See Gutteridge).

Based upon the above, it is abundantly clear that a property owner can be held liable for the injuries sustained by a contractor’s employee working at his property if he breaches the duty of care described above and does not fulfill his duty to warn.  Consequently, the highest standard of care that a property owner ought to maintain applies to an employee of a contractor at the property who is authorized to be working there.  Such an employee is a business invitee of the property owner.  Therefore, to that end, a property owner has a duty to protect such an employee from known dangers at the property and those which could be discovered with reasonable care.  The liability of the property owner is supplemental to, and/or in addition to, any liability the contractor may also have for his employee’s injuries.

Originally published in The Legal Intelligencer on January 28, 2016 and can be found here.

Limiting Legal Malpractice Claims: Applying the Glenbrook Analysis

The statue of limitations for a legal malpractice action in Pennsylvania is two years from the date of the malpractice; however that time period may be extended under certain circumstances.  In Glenbrook Leasing Co. v. Beausang, 839 A.2d 437 (Pa. Super. 2003), affirmed, 881 A.2d 1266 (Pa. 2005), the Pennsylvania Superior Court explored the viability of various ways to potentially extend that two year period.

Plaintiff in Glenbrook is a real estate partnership which purchased office space in a condominium development to be used as medical offices.  The agreement of sale for the office space included language granting Plaintiff use (and alleged ownership) of 35 parking spaces.  Nothing was placed in the deed regarding Plaintiff’s ownership of the aforesaid parking spaces.

About six years later, the condominium association took action to limit Plaintiff’s use of the aforesaid 35 parking spaces.  Unsurprisingly, a dispute arose between Plaintiff and the condominium association regarding the ownership and use of the parking spaces, which eventually evolved into litigation.  The litigation culminated in a ruling in favor of the condominium association.  The ruling was based on the merger doctrine, which generally states that any guarantee to be granted in a real estate transaction must be stated in the deed to the subject property.  As applied to the instant matter, Plaintiff was considered not to have any ownership rights over the parking spaces as they were not memorialized in the deed to the property.

When the initial real estate transaction took place, Plaintiff was represented by Defendant, a real estate law firm.  Plaintiff believed that its loss in the litigation against the condominium association, and the resulting loss of the 35 parking spaces, was a direct result of the legal malpractice of Defendant in failing to take into consideration the merger doctrine, and by failing to include language regarding the parking spaces in the deed to the property at issue.  About a year after the conclusion of the litigation against the condominium association, and about six years after the association first presented the issues regarding the deed, and its lack of language dealing with the parking spaces to Plaintiff, the company brought suit against Defendant law firm, claiming it committed legal malpractice.

Defendant ultimately filed a motion for summary judgement, claiming that Plaintiff brought suit far beyond the two year statute of limitations.  The trial court ruled in favor of Defendant.  On appeal, the Superior Court affirmed the trial court’s ruling, and the Supreme Court issued a per curiam order affirming the Superior Court’s ruling.  It is the Superior Court’s opinion that is the subject of this article.

While the statue of limitation in a legal malpractice claim is two years, that period can be extended via the equitable discovery rule which sates that the two years is initiated not at the occurrence of the malpractice, but when it was, or should have been, discovered.  The Court ruled that Plaintiff discovered, or should have discovered, that there may have been legal malpractice six years before it initiated suit against Defendant (or four years longer than the two year statute allows) when the dispute with the condominium association first arose.

Plaintiff then argued that the Court should apply the “continuous representation rule” which states that the limitations period would not begin to run until plaintiff terminated Defendant’s services.  The Court was unmoved by Plaintiff’s argument to extend the legal malpractice statute of limitations based on the continuous representation rule.  The Court noted that the rule was not the law of Pennsylvania (although it is in other jurisdictions) and it is not the place of the Superior Court to adopt new rules without authority to do so.

Plaintiff next argued that the limitations period should be extended through estoppel, asserting that the “special relationship” between a lawyer and his client lulled Plaintiff into a false sense of security, through fraud, or deception, or concealment, to trust Defendant beyond when it would have been prudent to do so.  This sort of argument has traction among physicians and patients and Plaintiff attempted here to apply it to attorneys and clients.  The Court rejected this argument as well, as it found Defendant was completely candid with Plaintiff regarding the claims made by the condominium association, including providing Plaintiff with the first allegation of their own malpractice nearly six years prior to Plaintiff’s bringing suit.

Finally, Plaintiff argued that the question of precisely when it discovered the malpractice is a question of fact that should have been decided by a jury, not via a motion for summary judgement.  The Court rejected this argument as well, ruling that the facts in this matter were abundantly clear as to when Plaintiff discovered the malpractice.

The statute of limitations is critical to be aware of when considering bringing suit.  Although the Court made a variety of rulings, as described above, it is significant and useful in that it lays out some guidelines as to how to apply the various means to extend the statute of limitations and notably refuses to adopt and apply the continuous representation rule.

Originally published in Upon Further Review on September 24, 2015 and can be seen here.

US Supreme Court Weighs in on Threats Over Social Media

The new reality of social interaction includes the popular, and seemingly always proliferating, social media websites like Facebook and Twitter.  Considering the increasing ubiquity of social media, it was only a matter of time before the United States Supreme Court would weigh in on its use, which it had opportunity to do in the matter of Anthony Douglas Elonis v. United States, 135 S.Ct. 2001 (2015).

 

In the Elonis matter, the petitioner Anthony Douglas Elonis’s wife left him in May 2010, taking their children with her.  Following their separation, Mr. Elonis began listening to “violent music” and posting so-called “rap lyrics” to his Facebook page.  Eventually he changed his name on his Facebook profile to “Tone Dougie,” a rap-style nom de plume, in order to create an “on-line persona.”  His rap lyrics contained rather violent and graphic language but did contain a disclaimer that his lyrics were fictions with no intentional resemblance to real persons.  He also said on Facebook that he writes these lyrics, and other such posts, as a form of therapy for himself to deal with the pain of the breakup of his family.

 

Unfortunately for Mr. Elonis, people who viewed his Facebook posts did not seem to appreciate his therapeutic efforts.  Evidently, after the Halloween following his separation, Mr. Elonis posted a photograph of himself from a Halloween event at his place of employ holding a toy knife to his co-worker’s throat, accompanied by a caption reading “I wish.”  Mr. Elonis was fired by his employer for this post due to its violent and threatening nature regarding his co-worker.

 

Mr. Elonis responded to his termination from employment at an amusement park with the following Facebook post: “Moles! Didn’t I tell y’all I had several? Y’all sayin’ I had access to keys for all the f***in’ gates. That I have sinister plans for all my friends and must have taken home a couple. Y’all think it’s too dark and foggy to secure your facility from a man as mad as me? You see, even without a paycheck, I’m still the main attraction. Whoever thought the Halloween Haunt could be so f***in’ scary?””  This post formed the basis for the first count of his criminal indictment for threatening park patrons and employees.

 

In addition to the above, Mr. Elonis also posted crude, demeaning, and violent material regarding his ex-wife, including a long post adapting a comedian’s sketch about how to avoid overtly saying one wishes to kill the president to a post of similar content about killing one’s wife.  In the post he included accurate details about his ex-wife’s home and rhetorically asked whether the reader is willing to “go to jail for [one’s] Constitutional rights.”

 

Upon seeing the above-mentioned post, his ex-wife began to fear for her life and secured a protection order against Mr. Elonis.  In response Mr. Elonis posted on Facebook what appeared to be lyrics or poetry contemplating whether a protection order could stop a bullet and suggested blowing up a police department with a bomb.  This post formed the basis of two more counts of his criminal indictment.  The fourth count of Mr. Elonis’s criminal indictment flowed from a subsequent Facebook post regarding potentially mass killing a local kindergarten class.  After the FBI investigated the aforesaid post, Mr. Elonis followed it up with what formed the basis of the fifth count of his criminal indictment, namely a post threatening the life of FBI agents (though none by name).

 

Mr. Elonis was eventually indicted for making threats to injure patrons and employees of the park, his estranged wife, police officers, a kindergarten class, and an FBI agent.  All of these threats were in violation of 18 U.S.C. Section 875(c) which states “[w]hoever transmits in interstate or foreign commerce any communication containing any threat to kidnap any person or any threat to injure the person of another, shall be fined under this title or imprisoned not more than five years, or both.”

 

Mr. Elonis filed a motion to dismiss the indictment on the basis that none of the charges against him contained any allegation that he intended to threaten anyone.  The District Court (his matter originated in the Eastern District of Pennsylvania) denied the motion.  At the trial for the charges Mr. Elonis testified that his posts were emulating rap lyrics (especially those of Eminem who also penned lyrics about killing his wife) and, therefore, were made without any intent to threaten anyone.  The prosecution presented witnesses who testified that they felt threatened and in fear of injury.  At the conclusion of the trial, Mr. Elonis’ requested that the jury be instructed that in order for him to be convicted the prosecution must prove he had an intention to threaten.  His request was denied.  Ultimately, Mr. Elonis was sentenced to three years and eight months’ incarceration and three years’ suspended release.  Mr. Elonis then appealed his conviction to the Court of Appeals of the Third Circuit which upheld the conviction and ruled that the intent suggested by Mr. Elonis was not required by the law.  Mr. Elonis then appealed to the United States Supreme Court, and it is that Court’s decision that is the subject of this article.

 

Mr. Elonis argued to the Supreme Court that the term “threat” necessarily implies an intention to inflict harm.  Unpersuaded, the Court pointed out that the definition of “threat” proffered by Mr. Elonis speaks to the message conveyed by the threatening statement and not the mental state of the speaker.  The government noted that the other crimes in the statutes neighboring 18 U.S.C. Section 875(c) all explicitly include a mental state in their terms which suggests that the legislature intentionally left such a provision out of 18 U.S.C. Section 875(c) and, therefore, no mental state is required for conviction under this section.  The Court was unpersuaded by this argument as well indicating that all that could be concluded is that Congress laid out a broad class of crimes but simply did not include what mental state, if any, is required for conviction.  Based on the above, the Court observed that neither party sufficiently identified any indication of any particular mental state required by 18 U.S.C. Section 875(c).  Despite this, the Court recognized that any crime must carry with it some conscious action (e.g.: mens rea) and that the mere omission of a mental state from 18 U.S.C. Section 875(c) does not mean none exists.

 

After a review of the applicable case law, the Court concluded that when a criminal statute is silent on mental state, the only mens rea that can be read into it is only that which is enough to separate wrongful conduct from innocent conduct as applied to each element of the crime.  Furthermore, the Court ruled that the mental state requirement, relative to Mr. Elonis’ case, must apply to whether the communication itself contains an actual threat.  By contrast, Mr. Elonis’ conviction was based solely upon how his posts would be perceived by a reasonable person.  As a result, the Court rejected the government’s argument for a mental state closer to negligence (i.e.: “reasonable person”) as well as Mr. Elonis’ argument from ignorance asserting that he could not be convicted unless it was shown he knew the posts could be characterized as threatening.

 

Ultimately the Court reversed Mr. Elonis’ conviction.  The Court held that the jury instructions mentioned above were insufficient.  There must be something more than the prosecution merely proving that a reasonable person could regard Mr. Elonis’ posts as threats.  Instead, there must be an instruction indicating that a mental state for Mr. Elonis is necessary for conviction.  The Court was confident that the mental state requirement would be satisfied if it could be shown that Mr. Elonis knew that his posts could be understood to be a threat and/or were posted to be threatening.  Although the Court rejected a negligence standard, as noted above, the Court declined to rule whether a recklessness standard would be sufficient to convict for the crime at issue herein as that issue was not raised by the parties until oral argument and briefly at that.  The Court was reluctant to be the first tribunal to rule on the issue and, instead, opted to allow the lower courts to initially look at the issue.  Consequently, the Court also remanded Mr. Elonis’ case for further proceedings per the Court’s ruling.

Originally published on August 25, 2015 in The Legal Intelligencer and can be seen here.

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