The state Superior Court has tossed out a transmission repair chain's legal malpractice suit against a Montgomery County, Pa., firm.
In Cottman Transmission Systems v. Law Offices of Peter E. Bort, a three-judge panel unanimously ruled in the result to affirm Montgomery County Court of Common Pleas Judge Arthur R. Tilson's ruling granting summary judgment to the law firm.
In an unpublished memorandum, Senior Judge Robert E. Colville, writing for the court, said the malpractice claims against defendant Law Offices of Peter E. Bort had been assigned to plaintiff Cottman Transmission Systems by the company's former franchisees after Cottman obtained a nearly $600,000 default judgment against the franchisees in a breach of contract suit.
On January 3, 2006, defendant Rochelle Bobman, an attorney with the Bort firm, had entered her appearance on behalf of the former franchisees — Brijesh Patel, Sital Patel and Sea Business Group — in both the money suit and equity suit Cottman had filed against them, but withdrew it the same day, according to Colville.
Cottman had alleged in the suits filed in the Montgomery County Court of Common Pleas that the former franchisees had breached their franchise agreement, Colville said.
On January 6, 2006, according to Colville, the trial court entered default judgment against the franchisees and, on January 20, 2006, denied their petition to open the judgment.
On appeal, the Superior Court affirmed the trial court's denial of the franchisees' petition, Colville said.
The franchisees then assigned their malpractice claims against the Bort firm to Cottman and Cottman filed suit against the firm, according to Colville.
Tilson granted summary judgment to the firm following oral argument, reasoning that the trial court's finding in Cottman's underlying action against the franchisees that there was no meritorious defense to the default judgment barred a malpractice claim under the doctrine of collateral estoppel, Colville said.
Cottman argued on appeal that Tilson's characterization of the trial court's ruling in the underlying action was incorrect, according to Colville.
Cottman said the trial court in the underlying action did not find that the franchisees had no meritorious defense to the default judgment, but rather that no meritorious defense had been sufficiently pled, Colville said.
According to Colville, the trial court said in its opinion in the underlying action that none of the franchisees' defenses against Cottman's claims of breach of the franchise agreement were meritorious, but Cottman argued that "'there were a myriad of good-faith defenses which could have been pled at the time … that would have kept the case alive and perhaps ultimately proved successful.'"
But, according to Colville, the only possible defense Cottman specifically mentioned the Bort firm should have made was a mitigation of damages defense to Cottman's lost future royalties claim.
"However, appellant does not provide any relevant discussion as to how this defense was a meritorious one to the underlying action or how it would have provided franchisees with relief from entry of the default judgment," Colville said. "Thus, appellant fails to persuade us of the existence of a genuine issue of material fact as to whether the law firm's alleged negligence was the proximate cause of damage to franchisees precluding the entry of summary judgment in this case."
Colville was joined by Judge Anne E. Lazarus.
President Judge Correale F. Stevens joined in the concurrence.
According to Colville, Cottman also argued on appeal that Tilson should not have relied on the trial court's ruling in the underlying action because the underlying action involved "'different parties, causes of action and operative facts.'"
But Colville said the argument was waived because Cottman failed to cite either relevant case law or statutory authority.
"Instantly, appellant fails to provide any relevant discussion as to why the particular ruling by the trial court in the underlying action was not applicable to dispose of the claims in the instant case," Colville said.
Cottman's vice president and general counsel, William B. Jameson, could not be reached for comment at press time.
Counsel for the Bort firm, Eugene J. Maginnis Jr. of Dugan Brinkmann Maginnis & Pace in Philadelphia, said his clients were "very happy" with the ruling.
(Copies of the seven-page opinion in Cottman Transmission Systems v. Law Offices of Peter E. Bort, PICS No. 13-2219, are available from Pennsylvania Law Weekly. Please call the Pennsylvania Instant Case Service at 800-276-PICS to order or for information.)