CONTRACTS

Breach • “Gist of the Action” Doctrine • Punitive Damages • UTPCPL

Thierry v. Matson, PICS Case No. 14-0471 (C.P. Northampton Feb. 11, 2014) Baratta, J. (13 pages).

Plaintiff’s tort claims were barred by the “gist of the action” doctrine because they arose from defendant’s alleged defective performance under the underlying contractual relationship between the parties. The court dismissed plaintiff’s tort claims and the request for punitive damages because such damages were not recoverable under breach of contract claims. The court denied defendant’s request to dismiss the claim for treble damages under the UTPCPL because it was not linked to punitive damages and it was in the trial court’s discretion to award treble damages. The court granted defendant’s motion to strike the paragraphs in the complaint that dealt with defendant’s prior criminal activity as it was immaterial, inappropriate and unrelated to the parties’ contractual dispute.

Plaintiff hired defendant, a contractor, to do some restoration work on her historical residence. Defendant terminated the contract before completing all the work and the dispute arose from defendant’s alleged defective performance, lack of necessary licenses, and retention of money paid by plaintiff. The amended complaint alleged fraud, home improvement fraud, violation of the UTPCPL, negligence per se, breach of warranty, damage to real property and trespass.

The court agreed with defendant as to plaintiff’s tort claims holding that they were barred by the “gist of the action” doctrine. This doctrine precludes turning breach of contract claims into tort claims. In determining whether plaintiff’s tort claims were barred, the court cited eToll, Inc. v. Elias/Savion Adver., Inc., 811 A.2d 10, 14 (Pa. Super. 2002) and J.J. DeLuca Co., Inc. v. Toll Naval Ass’n, 56 A.3d 402, 415 (Pa. Super. 2012). Plaintiff’s allegations of breach of contract included incomplete performance, quality of workmanship expected by plaintiff and failure to adhere to the agreed upon schedule of work to be completed. Plaintiff also claimed that defendant’s faulty workmanship caused water damage to plaintiff’s property and damage through improper disposal of toxic chemicals. The court dismissed plaintiff’s tort claims because they were inextricably intertwined with the contract claims when they stemmed from defendant’s alleged defective performance of the contract.

Plaintiff’s claim for punitive damages failed because punitive damages were not recoverable in a breach of contract claim and allegations of wantonness notwithstanding, the tort claims were barred by the gist of the action doctrine.

In addition to punitive damages, plaintiff sought treble damages under the UTPCPL for defendant’s outrageous and egregious behavior and his malice and wanton disregard. The court allowed plaintiff’s claim for treble damages to proceed because it was allowed under the UTPCPL and was not linked to the claim for punitive damages.

The amended complaint included references to defendant’s past criminal activity. Under Pa.R.Civ.P. 1028(a)(2), the court struck those two paragraphs in the amended complaint finding that they were unrelated to the contract claims and were offered only to attack the moral character of defendant and his employees.