Wage Payment and Collection Law; Attorneys’ Fees; Timeliness

Szwerc v. Lehigh Valley Health Network, 235 A.3d 331 (Pa. Super. 2020), allocatur granted Feb. 17, 2021, appeal docket 10 MAP 2021

The Pennsylvania Supreme Court will consider whether a trial court is divested of jurisdiction over a motion for attorneys’ fees under Pennsylvania’s Wage Payment and Collection Law, 43 P.S. §§ 260.1-260.12 (WPCL) that is filed more than 30 days following the court’s entry of final judgment.

Following the termination of his employment, Dr. Szwerc filed a lawsuit against Lehigh Valley Health Network and other related entities (employer) for breach of his employment contract. The court granted summary judgment in favor of Dr. Szwerc and determined that as a matter of law, the employer breached Dr. Szwerc’s employment contract. Thereafter, the court granted Dr. Szwerc’s request for $305,053.07 in attorneys’ fees under the WPCL, which specifically permits the recovery of “reasonable attorneys’ fees of any nature to be paid by the defendant,” 43 P.S. § 260.9a(f). The trial court summarized the relevant background as follows:

In reaching this sum, the [c]ourt reviewed hundreds of pages of billing statements and deducted charges that were duplicative, excessive, unnecessary, or otherwise unrelated to litigating the case under the WPCL. Of relevant note, the [c]ourt mistakenly directed [Appellee] Lehigh Valley Hospital, Inc. to pay the damages.

Both parties filed Post-Trial Motions on January 30, 2017. On February 17, 2017, the [c]ourt entered an Order with a Memorandum Opinion. The February 17, 2017 Order denied Appellees’ Motion for Post-Trial Relief and for a New Trial. The Order granted in part Appellant’s Post Trial Motion and amended the amount of legal fees awarded in the January 20, 2017 Order to $389,584.50.

On March 20, 2017, Appellees filed a Notice of Appeal. Appellant filed a Notice of Appeal on March 30, 2017. Both sides timely flied Concise Statements of Matters Complained of on Appeal.

On May 16, 2017, the [c]ourt conducted a settlement conference at the request of defense counsel to discuss a proposed withdrawal of the parties’ appeals. … During this conference, counsel for Appellees also put on the record that “one of the reasons for appeal [is] that it’s not [Appellee Lehigh Valley Hospital] who is the employer, but it’s [Appellee Lehigh Valley Physician Group].” The parties were unable to reach an agreement, and the matter proceeded on appeal to the Pennsylvania Superior Court.

On May 26, 2017, the [c]ourt entered its Pa.R.A.P. 1925(a) Opinion. In that Opinion, …the [c]ourt explained that because it found that the individually-named Appellees acted in good faith in their capacity as corporate officers, the judgment should not have been entered against them. The Opinion went on to state, “For those reasons, the [c]ourt’s Order of January 20, 2017 should be remanded in order to properly identify Lehigh Valley Physician Group as the [Appellee] against which the judgment on the breach of contract has been entered.”

On June 13, 2018, the Pennsylvania Superior Court affirmed this [c]ourt’s judgment in all respects, including affirming the decision granting summary judgment and affirming the orders awarding a reduced amount of attorneys’ fees. Szwerc v. Lehigh Valley Hospital et al., [193 A.3d 1073 (Pa.Super. 2018)] (unpublished memorandum). The Superior Court specifically addressed the request for a remand as follows:

The trial court requests remand for its January 20, 2017 order to be amended to “properly identify Lehigh Valley Physician Group as the [Appellee] against which judgment on the breach of contract has been entered.” We deem that order so amended by virtue of this memorandum.

Id. at 3 (citation omitted).

On September 20, 2018, the parties filed a Joint Petition to Substitute Judgment consistent with the Superior Court’s Order. The [trial c]ourt granted that petition on September 21, 2018.

Slip op. at 2-4.

Dr. Szwerc then filed a motion seeking an additional award of $156,356.84 in attorneys’ fees and costs stemming from pursuing the appeal and collecting on the judgment based on the allegation that the employer “would not voluntarily satisfy the Judgment following its loss at the Superior Court level.” Following argument, Dr. Szwerc supplemented his motion requesting additional attorneys’ fees and costs incurred in litigating the April 4, 2019 motion for fees.

The trial court denied Szwerc’s motion as untimely because it was filed 30 days after entry of the September 21, 2018 substituted judgment, such that the trial court no longer retained jurisdiction to entertain the motion pursuant to Section 5505 of the Judicial Code, which provides:

Modification of orders

Except as otherwise provided or prescribed by law, a court upon notice to the parties may modify or rescind any order within 30 days after its entry, notwithstanding the prior termination of any term of court, if no appeal from such order has been taken or allowed.

42 Pa.C.S.A. § 5505.

Dr. Szwerc appealed to Superior Court, arguing that the WPCL does not impose a time limitation on an employee judgment winner’s request for attorneys’ fees and costs. Dr. Szwerc further noted that he could not have filed his request for counsel fees and costs within 30 days of the September 21, 2018 substituted judgment, because in that timeframe, Dr. Szwerc could not have known whether the employer would file a petition for reargument, file a petition for allowance of appeal, and/or fail to satisfy the judgment. In support, Dr. Szwerc relied on in Township of Millcreek v. Angela Cres Trust of June 25, 1998, 142 A.3d 948 (Pa. Cmwlth. 2016), appeal denied, 166 A.3d 1236 (Pa. 2017), in which Commonwealth Court held that the Section 5505 time-bar did not apply to render untimely a motion for attorneys’ fees filed in conjunction with a fee-shifting provision of the Pennsylvania Eminent Domain Code.  Dr. Szwerc further argued that the trial court’s reliance on Section 5505 was misplaced because there was no request to modify any order. Appellant concludes his fee petition was filed in a timely manner, and this Court should reverse and remand for the trial court to consider Appellant’s request for attorneys’ fees, costs, and expenses, including those incurred litigating the current appeal.

Superior Court affirmed the trial court’s denial of Dr. Szwerc’s motion for attorneys fees on the basis that the filing of motion 30 days after entry of final judgment rendered the motion untimely.

Superior Court found Dr. Szwerc’s reliance on Township of Millcreek misplaced, reasoning that:

In that case, the Commonwealth Court relied upon the specific language in the Eminent Domain Code to conclude that fee requests under that statute are not subject to the 30-day period under Section 5505. In making its decision, the Commonwealth Court explained, inter alia, the Eminent Domain Code is the “complete and exclusive procedure and law to be followed in condemnation proceedings.” [Township of Millceek,] at 955. Thus, Section 5505, which applies “except as otherwise provided or prescribed by law,” could not restrict a condemnee’s request for fees incurred in defeating the condemnation, where the Eminent Domain Code provided no specific time limit regarding fee requests. Id. The Commonwealth Court further noted the lack of symmetry between the Judicial Code and the Eminent Domain Code, which “makes Section 5505 of the Judicial Code irrelevant to fee petitions filed under the Eminent Domain Code.” Id. at 955-56. Here, the WPCL does not contain similar statutory language to the Eminent Domain Code, or a similar lack of symmetry to the Judicial Code, to bar application of Section 5505.

Slip op. at 13-14 n. 2. Superior Court concluded that the trial court lacked jurisdiction to consider Dr. Szwerc’s motion explaining that:

… Appellant filed the current request for fees on April 4, 2019, ten months after this Court’s June 13, 2018 disposition and nearly six months after the trial court’s September 21, 2018 substituted judgment. Although Appellant claims that Section 5505 of the Judicial Code does not apply in this case, Pennsylvania law has repeatedly applied the 30-day time restriction under Section 5505 to requests for attorneys’ fees under Section 2503. See Samuel-Bassett [v. Kia Motors America, Inc., 34 A.3d 1 (Pa. 2011), cert. denied, 567 U.S. 935 (2012)]; Old Forge School Dist. [v. Highmark, Inc., 924 A.2d 1205 (Pa. 2007)]; Miller Elec. Co. [ v. DeWeese, 907 A.2d 1051 (Pa. 2006)].

Both Judicial Code Section 5505 and Rule of Appellate Procedure 1701 deprived the trial court of jurisdiction to consider Appellant’s fee motion, arguably, 30 days after June 13, 2018, and definitively 30 days after September 21, 2018. See Samuel-Bassett, supraOld Forge School Dist., supraMiller Elec. Co., supraFreidenbloom [v. Wayant, 814 A.2d 1253 (Pa. Super. 2003)]. That either party could have appealed from either the June 13, 2018 disposition or September 21, 2018 substituted judgment did not impede Appellant’s ability to file and the trial court’s authority to consider a timely motion for attorneys’ fees. See Samuel-Bassett, supraOld Forge School Dist., supraNess [v. York Twp. Bd. of Com’rs, 123 A.3d 1166 (Pa. Cmwlth. 2015)].

Furthermore, judicial policy requires finality in proceedings and cannot permit a litigant to prolong the case indefinitely by filing a motion for attorneys’ fees at any time. See Ness, supra. Based upon the foregoing, the trial court correctly concluded it lacked jurisdiction to consider Appellant’s untimely motion for attorneys’ fees. See Generation Mortg. Co. [ v. Nguyen, 138 A.3d 646 (Pa.Super. 2016)].

Slip op. at 13-14 (footnotes omitted).

The Supreme Court granted allocatur as to the following issue:

Whether the Superior Court erred in affirming the trial court’s order denying Petitioner’s Motion for Attorneys’ Fees and Costs Incurred in Appeal and Collection of Judgment on the basis that such motion was untimely and/or that the trial court lacked jurisdiction to consider same?

For more information, contact Kevin McKeon or Dennis Whitaker.