Friday, October 12, 2007

contracts - sales - venue - approval/acceptance of credit

84 Lumber Co. v. Fish Hatchery, L.P. et al. - Superior Court - Ocftober 1, 2007

Plaintiff-appellant is a building supplier who sued defendants-appellees for breach of contract, alleging non-payment for lumber and building materials purchased at plaintiff's retail location in Northampton County. Plaintiff sued in Washington County, the location of its corporate headquarters and the place where defendants' credit application was approved. Defendants were located in Lehigh County, as was the residential construction project for which the materials were purchased.

Defendants filed preliminary objections alleging improper venue, and the lower court transferred the case to Northampton County, which was a) the location of the lumber yard where defendants bought the materials, b) the location where defendants applied for credit, and c) the location where defendants made payments to plaintiff.

Noting that trial courts have "considerable discretion" in change-of-venue cases, the appellate court interpreted Rule 1006 (venue for civil actions generally) and Rule 2130 (venue where partnerships are parties), and sustained the change of venue to the Northampton County, where it held that the "transaction" had taken place and "not merely some part of the transaction...." The court said that the civil rules do not permit a lawsuit to be instituted in any country where some facet of a complex transaction -- such as the approval of the buyer's credit application -- has occurred.

The court said that there was no "substantial relationship" between Washington County and the parties' dispute which would justify venue there. It was at the retail location in Northampton County "where the offer to purchase goods was accepted by Appellant in its delivery of such good for payment." [sic] The court rejected the contention that approval of credit amounted to the actual acceptance of the contract, since there was no suggestion that the approval was necessary to form the contract.