Tuesday, April 20, 2010

misrepresentation - tort v. contract - gist of the action doctrine

Pediatrix Screening, Inc. v. Telechem Internation, Inc. - 3d Cir. - April 20, 2010


The Pennsylvania Superior Court has “operated under the assumption that the gist of the action doctrine is a viable doctrine that will eventually be explicitly adopted by [the] state’s High Court.” Reardon v. Allegheny Coll., 926 A.2d 477, 486 (Pa. Super. Ct. 2007). The 3d Circuit has embraced that view as well. Bohler-Uddeholm, 247 F.3d at 103-04.

The gist of the action “doctrine is designed to maintain the conceptual distinction between breach of contract claims and tort claims. As a practical matter, the doctrine precludes plaintiffs from re-casting ordinary breach of contract claims into tort claims.” eToll, Inc. v. Elias/Savon Adver., Inc., 811 A.2d 10, 14 (Pa. Super. Ct. 2002) (citation omitted). In some circumstances, “it is possible that a breach of contract also gives rise to an actionable tort[.] To be construed as in tort, however, the wrong ascribed to defendant must be the gist of the action, the contract being collateral.” Id. (alteration in original) (quoting Bash v. Bell Tel. Co., 601 A.2d 825, 829 (Pa. Super. Ct. 1992)). That the misconduct was fraudulent does not bar application of the gist of the action principle. Werwinski v. Ford Motor Co., 286 F.3d 661, 681 (3d Cir. 2002).

The Superior Court has held that fraud claims should be barred where they arose during the course of the parties’ contractual relationship; where the allegedly fraudulent acts also were breaches of duties “created and grounded in the . . . contract[;]” and where the damages “would be compensable in an ordinary contract action[ and] thus, the claim would essentially duplicate a breach of contract action.” eToll, Inc., 811 A.2d at 20-21. Where fraud claims are “inextricably intertwined” with the contract claims, the gist of the action is contractual, and the fraud claim should be dismissed. Id. at 21.

The test has been discussed in other cases as well, including Hart v. Arnold, 884 A.2d 316, 341 (Pa. Super. Ct. 2005) (dismissing fraud-in-the-performance claim because it “essentially duplicate[d] . . . breach of contract claim and [its] success . . . [wa]s wholly dependent on the terms of a contract”), and Pittsburgh Construction Co. v. Griffith, 834 A.2d 572, 584 (Pa. Super. Ct. 2003) (vacating award for conversion on gist of the action grounds where “tort and breach of contract claims [were] inextricably intertwined, the success of the conversion claim depending entirely on the obligations as defined by the contract”). Compare Sullivan v. Chartwell Inv. Partners, LP, 873 A.2d 710, 719 (Pa. Super. Ct. 2005) (separate fraud claim not barred when defendant “fraudulently . . . agreed to perform obligations that it never intended to perform in order to induce” plaintiff into entering into contract).

UC - voluntary quit - religious beliefs

Calhoun Jewelers LLC v. UCBR - April 20, 2010 - unpublished memorandum decision


The court reversed the grant of benefits to a claimant, who quit her job because of a conflict with her beliefs as a Jehovah's Witness, because she did not explain how the employer's instructions--to prepare a template for birthday cards to be sent to the employer's clients--violated her religious beliefs.

In Monroe v. UCBR, 535 A.2d 1222 (Pa. Cmwlth. 1988), this Court addressed the framework for a determination as to whether sincerely held religious beliefs conflict with job duties: The First Amendment right to the free exercise of religion applies to a sincerely held religious belief, and we do not believe that this right is limited only to beliefs held by members of established religions. . . . Accordingly, an actual conflict between one’s sincerely held religious beliefs and his or her employment conditions may constitute cause of a necessitous and compelling nature for voluntarily terminating employment. . . . .If it is determined that beliefs are sincerely held, then it must also be established that those beliefs are religious in nature. . . . . Monroe, 535 A.2d at 1224-1225.

Here, it is undisputed that Claimant was a Jehovah’s Witness. Claimant explained at the hearing before the referee that she believed that “many of the origins of birthdays are linked with false worship, even such things as birthday greetings, as happy birthday are linked with false worship of gods.” A church elder testified regarding the tenets of this religion concerning birthdays. There was no error in the determination that Claimant was a Jehovah’s Witness and, as a Jehovah’s Witness, she had sincerely held beliefs concerning the celebration of birthdays.

However, claimant did not establish that those sincerely held religious beliefs were in conflict with her employment conditions. It is Claimant’s burden to demonstrate that she had a necessitous and compelling reason for quitting her employment based on her sincerely held religious beliefs. Claimant established that she had sincerely held religious beliefs. However, the Board erred when it determined that the writing of a “personal message” on a birthday card violated Claimant’s religious beliefs when Claimant failed to describe the “personal message.” Claimant had the opportunity to articulate what the message was that she was instructed to write and to establish how that violated her religion, but she failed to do so.