Construction law is complicated. A trial judge can get it wrong. It may be necessary for an appellate court to sort out intricate areas of law.
But don’t assume an appellate court will also review the testimony, decide which witnesses were credible, and reach its own factual conclusions.
The Pennsylvania Superior Court’s recent decision in Hill v. Pasch Cos., Inc., No. 1629 MDA 2025, slip op. at 1 (Pa. Super. Ct. Sept. 11, 2026) (non-precedential) illustrates this point. The case arose from an oral construction contract. After a two-day bench trial, the trial judge accepted the plumber’s account of the agreement and rejected the builders’ competing version.
On appeal, the builders tried to challenge those factual findings.
However, the Superior Court would not retry the case. It affirmed the entire $224,514.65 judgment.
The Dispute Between the Plumber and the Builders
Stanley Hill operated Shrewsbury Plumbing and Heating. Around 2017, the Pasch Companies, Inc. and Paddock 55, LP hired him to perform plumbing work in a York County residential development. The parties did not sign a comprehensive written contract. Hence, there existed no “merger clause” or “integration clause” to “zip up” the contract as to only those terms set forth within one writing.
Instead, they reached an oral agreement.
Under that agreement, Hill would obtain the required permits, supply labor and materials, and perform the plumbing work. The parties agreed on one base price for houses with basements and another for houses built on slabs.
Over approximately five years, Hill performed plumbing work on 76 houses. The builders paid him for the first 57 houses without dispute.
Eventually, however, the relationship deteriorated. Hill claimed that the builders failed to pay 20 invoices covering work on 19 houses, along with one invoice for additional work. The unpaid principal totaled $132,440.43.
Hill sued for breach of contract. He also sought relief under Pennsylvania’s Contractor and Subcontractor Payment Act, commonly known as CASPA.
Why the Trial Court’s Factual Findings Controlled
The builders argued that Hill’s testimony was inconsistent and not credible. In essence, they asked the Superior Court to accept their version of the agreement instead of Hill’s version.
The Superior Court declined to do so.
In a nonjury trial, the trial judge serves as the factfinder. The judge hears the witnesses, observes their demeanor, and evaluates their credibility. The judge may believe all, part, or none of a witness’s testimony.
As a result, the appellate court does not independently reweigh the evidence. Nor does it substitute its judgment for that of the trial judge.
Instead, factual findings receive considerable deference. A decision concerning the weight of the evidence is among the most difficult trial-court rulings to overturn. Appellate relief is available only when the record establishes a palpable abuse of discretion.
That did not happen here. The record contained competent evidence supporting Hill’s account. Therefore, the Superior Court had no basis to disturb the trial court’s findings.
This distinction is important. Appellate courts review legal questions under a less deferential standard. But they generally do not provide a second trial on disputed facts or witness credibility.
The Elements of a Pennsylvania Contract Claim
To recover for breach of contract in Pennsylvania, a plaintiff must establish:
- The existence of a contract, including its essential terms;
- A breach of a duty imposed by the contract; and
- Resulting damages.
Contract formation generally requires an offer, acceptance, and consideration. Moreover, a contract does not always have to be in writing to be enforceable.
When the parties dispute the terms of an oral agreement, the fact-finder decides the case. It’s usually a jury but a judge can also serve as the fact-finder if the parties agree or waive a jury trial. The fact-finder evaluates the parties’ course of dealing and the surrounding circumstances to determine what the parties had actually intended.
The first question is: did the parties reach an agreement? Here, the evidence established each essential element.
The builders:
- hired Hill to perform plumbing work and
- agreed to pay set base rates.
Hill agreed to:
- obtain permits,
- provide labor and materials, and complete the work.
His plumbing passed the required township inspections. The builders then sold the completed houses.
Nevertheless, the builders did not pay the outstanding invoices.
The trial court concluded that Hill proved the existence of the agreement, the builders’ breach, and his resulting damages. The Superior Court found no legal or factual basis to disturb that conclusion.
The Builders’ Claimed Additional Contract Terms
The builders raised an affirmative defense. They alleged that the oral agreement included three additional conditions:
- Hill would not be paid unless a signed purchase order was issued before work began;
- Hill would not be paid if his final invoice exceeded the amount stated in the purchase order; and
- Hill would not be paid if he failed to submit an invoice within a reasonable time after completing the work.
Hill denied that the parties agreed to those conditions.
He also explained why some invoices exceeded the preliminary purchase-order amounts. Certain houses required additional copper, special fittings, or homeowner-requested upgrades. According to Hill, the builders approved those additional expenses.
Therefore, the parties presented conflicting testimony about the terms of their oral agreement. This created a classic “question of fact” to be decided by the fact-finder. The trial judge (fact-finder) believed Hill. It found that the alleged purchase-order, invoice-matching, and billing-deadline requirements were not part of the contract.
An affirmative defense depends on additional facts that would defeat the plaintiff’s claim. The party raising the defense bears the burden of proving those facts. Here, the builders did not persuade the trial court that the additional conditions existed.
On appeal, they could not simply ask the Superior Court to reconsider credibility and reach the opposite conclusion.
How CASPA Applied to the Unpaid Work
CASPA applies to both written and oral construction contracts. Its purpose is to protect contractors and subcontractors while promoting fair dealing in construction projects.
Under CASPA, a contractor who performs in accordance with the contract is entitled to payment. The statute may also authorize interest, penalties, attorney’s fees, and litigation expenses when payment is improperly withheld.
The builders argued that CASPA did not apply because Hill had violated the alleged purchase-order and billing requirements.
However, that argument depended on their version of the contract. The trial court had already found that those requirements were not part of the agreement. Therefore, Hill could not have breached them.
The Superior Court also rejected the builders’ decision to withhold the entire amount owed.
CASPA permits an owner to withhold payment for disputed or deficient items in appropriate circumstances. Nevertheless, the owner must pay for invoiced work that was satisfactorily completed.
Even if the builders had a legitimate dispute over some additional charges, they could not withhold every dollar. At a minimum, they should have paid the undisputed amounts shown on their own purchase orders and litigated the remaining differences.
Instead, they paid nothing. They withheld even the $106,307.56 reflected in their signed purchase orders. Meanwhile, the plumbing had passed inspection, and the builders had sold the completed houses.
The courts found no good-faith basis for withholding that undisputed amount.
The Final Award
The trial court entered a $224,514.65 judgment against the builders. The award consisted of:
- $132,440.43 in unpaid principal;
- $34,434.40 in CASPA interest, calculated at 1% per month for 26 months;
- $27,639.82 in CASPA penalties, calculated at 1% per month on the purchase-order-approved portion of the invoices; and
- $30,000 in attorney’s fees.
Hill presented evidence of more than $50,000 in legal fees. Even so, the trial court limited the fee award to $30,000. It also imposed the statutory penalty only on the portion supported by issued purchase orders, rather than on the entire principal balance.
The Superior Court affirmed the judgment in full.
Conclusion
Once the trial judge decides which account is credible, changing that result on appeal may be exceedingly difficult. Hill v. Pasch Companies demonstrates the point clearly. The builders did not lose because the Superior Court independently preferred Hill’s testimony. They lost because the trial court had already accepted his testimony, and the record gave the appellate court no permissible basis to overturn that factual determination. The central lesson from Hill extends beyond construction-contract disputes.
Let’s Get Started!
Contact our lawyers today!
