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HomeMy WebLinkAbout08-2530LINDA MOWERY, Plaintiff ) vs. ) CINDY RHOADS and DEBRA L. RHOADS, ) individually, and CINDY RHOADS and ) DEBRA L. RHOADS, co-partners trading as ) RHOADS & RHOADS PARTNERSHIP, ) Defendants ) IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 08 -cZS.36 CONFESSION OF JUDGMENT CONFESSION OF JUDGMENT Pursuant to the authority contained in the warranty of attorney, the original or a copy of which is attached to the complaint filed in this action, I appear for the Plaintiff and confess judgment in favor of the Plaintiff and against the Defendants, as follows: Principal $100,000.00 Attorney's fees and costs (at 10% per the Note) $10,000.00 Total $110,000.00 Plus interest on the principal balance, at the rate of nine (9%) percent per annum, after 1 February 2008, together with interest on the judgment, once entered, at the rate of nine (9%) percent per annum, plus costs of suit. Samuel L. Andes Attorney for Plaintiff Supreme Court ID # 17225 P.O. Box 168 Lemoyne, Pa 17043 (717) 761-5361 LINDA MOWERY, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA VS. CINDY RHOADS and DEBRA L. RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co-partners trading as RHOADS & RHOADS PARTNERSHIP, Defendants CIVIL ACTION - LAW NO. 09- aS3d CONFESSION OF JUDGMENT COMPLAINT FOR CONFESSION OF JUDGMENT AND NOW comes the above-named Plaintiff, by her attorney, Samuel L. Andes, and makes the following Complaint for the entry of judgment by confession in this matter, based upon the following: 1. The Plaintiff is Linda Mowery an adult individual who resides at 1581 Walnut Bottom Road in Newville, Cumberland County, Pennsylvania. The Plaintiff was, in August of 2002, known as Linda Sedell and changed her name to Mowery following her marriage after that date. 2. The Defendants are Cindy Rhoads, an adult individual who resides at 343 Old State Road in Gardners, Cumberland County, Pennsylvania 17324, Debra L. Rhoads, an adult individual who resides at 211 West Pine Street in Mt. Holly Springs, Cumberland County, Pennsylvania 17065 and Cindy Rhoads and Debra L. Rhoads, co-partners trading as Rhoads & Rhoads Partnership which has a business address at 1 Pine Grove Road in Gardners, Cumberland County, Pennsylvania 17324. 3. In August of 2002, as part of a transaction whereby the Plaintiff sold real estate and business assets to the three Defendants, the three Defendants gave Plaintiff a Promissory Note in the original principal amount of $100,000.00, and containing various interest and other payment terms. A true and correct reproduction of the original of that Note is attached hereto and marked as Exhibit A. 4. The Note given by Defendants to Plaintiff, attached hereto as Exhibit A, has not been assigned by any party. No judgment has been previously entered on that Note in this or any other jurisdiction. 5. Defendants have breached their obligations under the said Note in the following ways: A. They have failed to make principal payments due on the Note in accordance with Paragraph 2 of the Note. B. They have failed to pay the full balance, of principal and interest, by l February 2008, as required by Paragraph 2 of the Note. As a result, the Defendants are now in default of the Note. 6. Plaintiff, by her attorney, notified Defendants of their default and demanded that they cure it within thirty (30) days. A copy of that letter is attached hereto and marked as Exhibit B. 7. As a result of the Defendants' default, Defendants now owe Plaintiff the principal balance of $100,000.00, plus interest after 1 February 2008, at the rate of nine (9%) percent per annum. In addition, Defendants owe Plaintiff an attorney's commission of ten (10%) percent of the unpaid principal balance and accrued interest, in accordance with Paragraph 11 of the Note. 8. Paragraph 11 of the Note authorizes Plaintiff to confess judgment against the Defendants for all sums due under the Note. 9. Judgment in this matter has not been entered by confession against the Defendants. This is not a consumer credit transaction; the debt being enforced by this complaint is a commercial debt. WHEREFORE, Plaintiff prays this Court to enter judgment against the Defendants, jointly and severally, by confession, in the amount of $100,000.00, plus interest at the rate of nine (9%) percent per annum after 1 February 2008, with an attorney's commission of $10,000.00, plus interest on the amount of the judgment, at the rate of ten (10%) percent per annum, continuing until full payment has been made, plus costs of suit. Sam. L. Andes Attorney for Plaintiff Supreme Court ID # 17225 P.O. Box 168 Lemoyne, Pa 17043 (717) 761-5361 I verify that the statements made in this document are true and correct. I understand that any false statements in this document are subject to the penalties of 18 Pa. C.S. 4904 (unsworn falsification to authorities). Date: { THIS IS A COMMERCIAL TRANSACTION AND ANY REFERENCE TO ACTS WHICH APPLY TO RESIDENTIAL REAL ESTATE SHALL BE CONSIDERED NULL AND VOID. DATE: August 5, 2002 U.S. $100,000.00 Secondary Mortgage Loan Promissory Note 1 Pine Grove Road, Gardners, PA 17324 1• BORROWER'S PROMISE TO PAY In return for a loan that I have received, I promise to pay U.S. $100,000.00 (this amount will be called "principal"), plus interest, to the order of the Lender. The Lender is Linda Sedell. I understand that the Lender may transfer this Note. The Lender or anyone who takes this Note by transfer and who is entitled to receive payments under this Note will be called the "Note Holder." 2. PAYMENTS There shall be no payment of principal or accrual of interest until February 1, 2003. Commencing March 1, 2003, and on the first day of each month thereafter for a period of thirty- six (36) months, the undersigned shall pay interest only of $500 per month, being interest calculated at 6% per annum. Commencing on March 1, 2006, the undersigned shall pay principal and interest calculated at the Wall Street Journal prime rate, plus 1.5% amortized over 15 years, but in no event less than 70 (monthly payments of principal and interest at 7% are $898.83) The undersigned shall use their best efforts to refinance this debt on or before August 1, 2006. The undersigned shall provide lender with written documentation of the same. NOTHING HEREIN TO THE CONTRARY, THE ENTIRE AMOUNT OF UNPAID PRINCIPAL AND ACCRUED INTEREST SHALL BE DUE AND PAYABLE ON FEBRUARY 1, 2008. 3. BORROWER'S FAILURE TO PAY AS REQUIRED (A) Default If I do not pay the full amount of each monthly payment by the date stated in Section 2 above, I will be in default. Even if, at a time when I am in default, the Note Holder does not require me to pay immediately in full as described below, the Note Holder will still have the right to do so if I am in default at a later time. (B) Notice From Note Holder If I am in default, the Note Holder may send me a written notice telling me that if I do not pay the overdue amount by a certain date the Note Holder may require me to pay immediately the full amount of principal which has not been paid and all the interest that I owe on that amount. The date must be at least thirty (30) days after the date on which the Notice is mailed to me, or, if it is not mailed, thirty (30) days after the date on which it is delivered to me. (C) Payment of Note Holder's Costs and Expenses If the Note Holder has required me to pay immediately in full as described above, the Note Holder will have the right to be paid back for all of its costs and expenses to the extent not prohibited by applicable law. Those expenses include, for example, reasonable attorneys' fees. 4. LATE CHARGE FOR OVER DUE PAYMENTS. If the Note Holder has not received the full amount of any monthly payment by the end of 15 calendar days after the date it is due, I will pay a late charge to the Note Holder. The amount of the charge will be 5% of my overdue payment of principal and interest. I will pay this late charge promptly but only once on each late payment. 5. THIS NOTE SECURED BY A MORTGAGE In addition to the protections given to the Note Holder under this Note, a Mortgage, dated Protects the Note Holder from possible losses which might result if I do not keep the promises which I make in this Note. That Mortgage describes how and under what conditions I may be required to make immediate payment in full of all amounts that I owe under this Note. 6. BORROWER'S PAYMENTS BEFORE THEY ARE DUE I have the right to make payments of principal at any time before they are due. A payment of principal only is known as a "prepayment". When I make a prepayment, I will tell the Note Holder in a letter that I am doing so. A prepayment of all of the unpaid principal is known as a "full prepayment". A prepayment of only part of the unpaid principal is known as a "partial prepayment". I may make a full prepayment or a partial prepayment without paying any penalty. The Note Holder will use all of my prepayments to reduce the amount of principal that I owe under this Note. If I make a partial prepayment, there will be no delays in the due dates or changes in the amounts of my monthly payments unless the Note Holder agrees in writing to those delays or changes. I may make a full or partial prepayment at any time. 7. BORROWER'S WAIVERS I waive my rights to require the Note Holder to do certain things. Those things are: (A) to demand payment of amounts due (known as "presentment"); (B) to give notice that amounts due have not been paid (known as "notice of dishonor"); (C) to obtain an official certification of nonpayment (known as a "protest"). Anyone else who agrees to keep the promises made in this Note, or who agrees to make payments to the Note Holder if I fail to keep my promises under this Note, or who signs this Note to transfer it to someone else also waives these rights. These persons are known as "guarantors, sureties and endorsers" 8• GIVING OF NOTICES Any notice that must be given to me under this Note will be given by delivering it or by mailing it by certified mail addressed to me at the Property Address above. A notice will be delivered or mailed to me at a different address if I give the Note Holder a notice of my different address. Any notice that must be given to the Note Holder under this Note will be given by mailing it by certified mail to the Note Holder at the address stated in Section 3 above. A notice will be mailed to the Note Holder at a different address if I am given a notice of that different address. 9. RESPONSIBILITY OF PERSONS UNDER THIS NOTE If more than one person signs this Note, each of us is fully and personally obligated to pay the full amount owed and to keep all of the promises made in this Note. Any guarantor, surety, or endorser of this Note (as described in Section 8 above) is also obligated to do these things. The Note Holder may enforce its rights under this Note against each of us individually or against all of us together. This means that any one of us may be required to pay all of the amounts owed under this Note. Any person who takes over my rights or obligations under this Note will have all of my rights and must keep all of my promises made in this Note. Any person who takes over the rights or obligations of a guarantor, surety, or endorser of this Note (as described in Section 8 above) is also obligated to keep all of the promises made in this Note. 10. COPY RECEIVED Borrower hereby acknowledges receipt of a true copy of this instrument. 11. CONFESSION OF JUDGMENT BORROWER HEREBY IRREVOCABLE AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR BORROWER AFTER A DEFAULT UNDER THIS NOTE AND WITH OR WITHOUT COMPLAINT FILED, CONFESS OR ENTER JUDGMENT AGAINST BORROWER FOR THE ENTIRE PRINCIPAL BALANCE OF THIS NOTE AND ALL ACCRUED INTEREST, LATE CHARGES AND ANY AND ALL AMOUNTS EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THIS NOTE, TOGETHER WITH COSTS OF SUITE, AND AN ATTORNEY'S COMMISSION OF TEN PERCENT (100) OF THE UNPAID PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS ($500) ON WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS NOTE OR A COPY OF THIS NOTE VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY GRANTED IN THIS NOTE TO CONFESS JUDGMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS NOTE. BORROWER HEREBY WAIVES ANY RIGHT BORROWER MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT AND STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO BORROWER'S ATTENTION OR BORROWER HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL. RHOADS & OARS PARTNERSHIP ti. Witness: B (Seal) ?3id oads Partner (Seal) By: D ae L. oads, Partner Witn (Seal) By. Cind oads, Individually (Seal) By: Debra L.. , ndividually f MAILING ADDRESS: P. 0. BOX 168 LEMOYNE, PA 17043-0168 E-MAIL: LawAndes*aol.com ? - - - -- - - - - -- -- Hubert X. Gilroy, Esquire 10 Eastl3igl-i eef----- Carlisle, PA 17013 RE: Rhoads/Mowery Dear Hubert: 7 March 2008 TELEPHONE (717) 761-5361 FAX (717) 761-1435 I have not heard from you for two months. Your clients have not made the principal payments due under the note but have only made interest payments and we do not believe they have made all of those. Moreover, they have not paid the full balance of principal and interest by 1 February 2008, as required by the original note. We also have learned that they recently listed the property for sale. This letter is directed to your clients, through you, pursuant to Paragraph 3(B) of the Note, to advise your clients of their default and give them thirty (30) days to cure that default by paying the full balance of funds due my client under the Note. That will be $100,000.00 in principal plus interest at the rate of 9 percent after 1 February 2008. If your clients have made any interest payments after the first of February, we will, of course, give them credit for those payments. Please have your clients make this payment through my office no later than thirty (30) days from the date of this letter. Sincerely, le SAMUEL L. ANDES ATTORNEY AT LAW 525 NORTH TWELFTH STREET P. O. BOX 168 LEMOYNE, PENNSYLVANIA 17043 Samuel L. Andes cc: Ms. Linda Mowery cn lY v-? T, rs :a x -r t? a 8FAFILES\Clients\12458 Rhoads\12458.1pet.judgmcnt.wpd\tde Hubert X. Gilroy, Esquire I.D. No. 29943 Trudy E. Fehlinger, Esquire I.D. No. 202753 MARTSON DEARDORFF WILLIAMS OTTO GILROY & FALLER MARTSON LAW OFFICES 10 East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Defendants LINDA MOWERY, IN THE COURT OF COMMON PLEAS OF Plaintiff, CUMBERLAND COUNTY, PENNSYLVANIA V. NO. 2008-2530 CINDY RHOADS and DEBRA L. RHOADS, CIVIL ACTION - EQUITY individually, and CINDY RHOADS and DEBRA L. RHOADS, co-partners trading as RHOADS & RHOADS PARTNERSHIP, : CONFESSION OF JUDGMENT Defendants PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND NOW, come the Defendants, Cindy Rhoads and Debra L. Rhoads, individually, and as co-partners trading as Rhoads & Rhoads Partnership, by and through their attorneys, MARTSON DEARDORFF WILLIAMS OTTO GILROY & FALLER, and hereby file the following Petition to Open or Strike Confessed Judgment, averring as follows: 1. Petitioners are Cindy Rhoads, an adult individual residing at 343 Old State Road, Gardners, Cumberland County, Pennsylvania 17324; Debra L. Rhoads, an adult individual residing at 211 West Pine Street, Mt. Holly Springs, Cumberland County, Pennsylvania 17065; and Cindy Rhoads and Debra L. Rhoads, co-partners trading at Rhoads & Rhoads Partnership, having a principal business address of 1 Pine Grove Road, Gardners, Cumberland County, Pennsylvania 17324. 2. Respondent Linda Mowery is an adult individual residing at 1581 Walnut Bottom Road, Newville, Cumberland County, Pennsylvania 17241. 3. On August 5, 2002, the parties entered into a Secondary Mortgage Loan Promissory Note for the business located at 1 Pine Grove Road, Gardners, Cumberland County, Pennsylvania 17324. A copy of the Secondary Mortgage Loan Promissory Note is attached hereto as Exhibit "A." 4. Pursuant to the terms of the Promissory Note, Petitioners were obligated to make monthly interest-only payments in the amount of $500.00 for a period of three years commencing March 1, 2003. Secondary Mortgage Loan Promissory Note, Paragraph 2. 5. Thereafter, commencing on March 1, 2006, Petitioners were obligated to make monthly principal and interest payments calculated at the Wall Street Journal prime rate, plus 1.5% amortized over 15 years, but in no event less than 7%. Secondary Mortgage Loan Promissory Note, Paragraph 2. 6. The Promissory Note further obligated Petitioners to use their best efforts to refinance the debt on or before August 1, 2006, and to provide Respondent with written documentation of the same. Secondary Mortgage Loan Promissory Note, Paragraph 2. 7. The Promissory Note provided that the entire amount of unpaid principal and interest were payable on February 1, 2008. Secondary Mortgage Loan Promissory Note, Paragraph 2. 8. On March 21, 2008, Respondent filed a Complaint for Confession of Judgment against Petitioners as a result of Petitioner's failure to pay the entire amount of the unpaid principal and accrued interest on February 1, 2008. 9. On that same date, Respondent filed a Confession of Judgment against Petitioners claiming that the principal balance on the Promissory Note is $100,000.00, plus $10,000.00 (10%) attorney's fees and interest at the rate of 9% per annum. 10. The amount ofthe confessed judgment entered by Respondent includes the following amounts: a. Principal $100,000.00 b. Attorneys fees and costs at 10% per the Note $10,000.00 C. Plus interest on the principal balance, at the rate of nine percent (9%) per annum, after February 1, 2008 d. Together with interest on the judgment, once entered, at the rate of nine percent (9%) per annum e. Plus costs of suit 11. The Pennsylvania Rule of Civil Procedure authorize Petitioners to move to open or strike the Confession of Judgment. Pa.R.C.P. 2959. 12. The Pennsylvania Rules of Civil Procedure provide that if the petition states prima facie grounds for relief, the court shall issue a rule to show cause and may grant a stay of proceedings. Pa.R.C.P.2959(b). 13. To meet the burden for opening a confession of judgment, petitioner must act promptly, allege meritorious defense, and provide sufficient evidence to create an issue for determination by a jury. Crum v. F.L. Shaffer Co., 693 A.2d 984 (Pa. Super. 1997); See also Germantown v. Sav. Bank v. Talacki, 411 Pa. Super. 513, 657 A.2d 1285 (1995)(court must open confession of judgment if the petitioner promptly presents evidence on petition to open which, in jury trial, would require that issue be submitted to jury.) 14. In reviewing a petition to open or strike a confession of judgment, the court should view the evidence in the light most favorable to the petitioner and accept as true all evidence and proper inferences which support the defense, while rejecting adverse allegations of the party obtaining the judgment. F.D.I.C. v. Degllau, 207 F.3d 153 (Pa. 2000). 15. The lien of the judgment shall be preserved while the proceedings to strike off or open the judgment are pending. Pa.R.C.P. 2959(f). 16. The Confession of Judgment in the instant matter should be opened or stricken because Respondent included inaccurate and improper amounts in the judgment. 17. Petitioners made interest-only payments of $500.00 per month on the Promissory Note beginning in March 2003 and continuing through February 2006. 18. Although the Promissory Note called for Petitioners to begin making payments of interest and principal on March 1, 2006, Petitioners and Respondent reached an oral agreement whereby Respondent agreed to allow Petitioners to continue making interest-only payments for an additional year. 19. In accordance with the oral agreement, Petitioners continued making interest-only payments of $500.00 per month until they were advised by Respondent that they should have been making interest-only payments in the amount of $750.00 per month due to an increased interest rate. 20. Upon receiving such notice from Respondent, Petitioners increased their monthly interest-only payments to $750.00 and paid Respondent the $250.00 difference in all previous interest-only payments back to March 1, 2006. 21. In January, February and April of 2007, Petitioners made interest-only payments of $750.00 per month. 22. Petitioners further made eleven monthly payments of $1,015.00 of interest and principal for the months of May 2007 through April 2008, totaling $12,180.00. 23. Petitioners continue to make monthly interest and principal payments of $1,015.00 on the Promissory Note. 24. The Confession of Judgment filed by Respondent does not reflect the payments made by Petitioners in partial satisfaction of the Secondary Mortgage Loan Promissory Note. 25. Petitioners have also made a good faith effort to comply with the additional payment terms of the Promissory Note, including using their best efforts to refinance the debt and advising Respondent of same. 26. Petitioners are actively taking steps to sell Twirly Top Restaurant, Inc., the business that is the basis for the loan in an effort to pay off the Promissory Note. 27. In addition to the inclusion of inaccurate and improper amounts, the Confession of Judgment should be opened or stricken because the attorneys fees provided for in the Promissory Note are unreasonable and unconscionable in light of the time, labor and skill involved in securing the judgment. Philadelphia Acceptance Corp. v. Krapf, 35 Pa. D.&C.3d 101, 105 (Bucks County 1984). 28. The attorney's fee of $10,000.00 or 10% of the principal borrowed that Respondent seeks to recover is unreasonable and unconscionable considering the amount of time and effort expended by Respondent's attorney in this case. 29. Counsel for Respondent filed a Complaint for Confession of Judgment and a one page Confession of Judgment, and has exchanged correspondence with the undersigned counsel. 30. In light of the minimal time, labor and skill involved in securing the judgment against Petitioners, $10,000.00 or 10% of the original principal borrowed is an unfair, inequitable and unreasonable commission. 31. No judge has ruled upon any issue in this matter. 32. Counsel for Petitioners certifies that the parties, after reasonable effort, are unable to resolve the dispute. WHEREFORE, Petitioners respectfully request that this Honorable Court issue a stay of the proceedings in this matter and issue a Rule to Show Cause why the judgment in this matter should not be opened or stricken. TSON LAW OFFICES Date: April 30, 2008 B Hubert X. Gilroy, squire Trudy E. Fehlin r, Esquire I.D. Nos. 299 and 202753 10 East HiRfi Street Carlisle,15A 17013 (717) 24 -3341 Attorneys for Defendants 4F* nP IV I)Ync,k 0.0 -1-1 THIS IS A COMMERCIAL TRANSACTION AND ANY REFERENCE TO ACTS WHICH APPLY TO RESIDENTIAL REAL ESTATE SHALL BE CONSIDERED NULL AND VOID. DATE: August 5, 2002 U.S. $100,000.00 Secondary Mortgage Loan Promissory Note 1 Pine Grove Road, Gardners, PA 17324 1. BORROWER'S PROMISE TO PAY In return for a loan that I have received, I promise to pay U.S. $100,000.00 (this amount will be called "principal"), plus interest, to the order of the Lender. The Lender is Linda Sedell. I understand that the Lender may transfer this Note. The Lender or anyone who takes this Note by transfer and who is entitled to receive payments under this Note will be called the "Note Holder." 2. PAYMENTS There shall be no payment of principal or accrual of interest until February 1, 2003. Commencing March 1, 2003, and on the first day of each month thereafter for a period of thirty- six (36) months, the undersigned shall pay interest only of $500 per month, being interest calculated at 6% per annum. Commencing on March 1, 2006, the undersigned shall pay principal and interest calculated at the Wall Street Journal prime rate, plus 1.5% amortized over 15 years, but in no event less than 7% (monthly payments of principal and interest at 7% are $898.83) The undersigned shall use their best efforts to refinance this debt on or before August 1, 2006. The undersigned shall provide lender with written documentation of the same. NOTHING HEREIN TO THE CONTRARY, THE ENTIRE AMOUNT OF UNPAID PRINCIPAL AND ACCRUED INTEREST SHALL BE DUE AND PAYABLE ON FEBRUARY 1, 2008. 3. BORROWER'S FAILURE TO PAY AS REQUIRED (A) Default If I do not pay the full amount of each monthly payment by the date stated in Section 2 above, I will be in default. Even if, at a time when I am in default, the Note Holder does not require me to pay immediately in full as described below, the Note Holder will still have the right to do so if I am in default at a later time. (B) Notice From Note Holder If I am in default, the Note Holder may send me a written notice telling me that if I do not pay the overdue amount by a certain date the Note Holder may require me to pay immediately the full amount of principal which has not been paid and all the interest that I owe on that amount. The date must be at least thirty (30) days after the date on which the Notice is mailed to me, or, if it is nct mailed, thirty (30) days after the date on which it is delivered to me. (C) Payment of Note Holder's Costs and Expenses If the Note Holder has required me to pay immediately in full as described above, the Note Holder will have the right to be paid back for all of its costs and expenses to the extent not prohibited by applicable law. Those expenses include, for example, reasonable attorneys' fees. 4. LATE CHARGE FOR OVER DUE PAYMENTS. If the Note Holder has not received the full amount of any monthly payment by the end of 15 calendar days after the date it is due, I will pay a late charge to the Note Holder. The amount of the charge will be 5% of my overdue payment of principal and interest. I will pay this late charge promptly but only once on each late payment. 5. THIS NOTE SECURED BY A MORTGAGE In addition to the protections given to the Note Holder under this Note, a Mortgage, dated Protects the Note Holder from possible losses which might result if I do not keep the promises which I make in this Note. That Mortgage describes how and under what conditions I may be required to make immediate payment in full of all amounts that I owe under this Note. 6. BORROWER'S PAYMENTS BEFORE THEY ARE DUE I have the right to make payments of principal.. at any time before they are due. A payment of principal only is known as a "prepayment". When I make a prepayment, I will tell the Note Holder in a letter that I am doing so. A prepayment of all of the unpaid principal is known as a "full prepayment". A prepayment of only part of the unpaid principal is known as a "partial prepayment". I may make a full prepayment or a partial prepayment without paying any penalty. The Note Holder will use all of my prepayments to reduce the amount of principal that I owe under this Note. If I make a partial prepayment, there will be no delays in the due dates or changes in the amounts of my monthly payments unless the Note Holder agrees in writing to those delays or changes. I may make a full or partial prepayment at any time. 7. BORROWER'S WAIVERS I waive my rights to require the Note Holder to do certain things. Those things are: (A) to demand payment of amounts due (known as "presentment"); (B) to give notice that amounts due have not been paid (known as "notice of dishonor") ; (C) to obtain an official certification of nonpayment (known as a "protest"). Anyone else who agrees to keep the promises made in this Note, or who agrees to make payments to the Note Holder if I fail to keep my promises under this Note, or who signs this Note to transfer it to someone else also waives these rights. These persons are known as "guarantors, sureties and endorsers". 8. GIVING OF NOTICES Any notice that must be given to me under this Note will be given by delivering it or by mailing it by certified mail addressed to me at the Property Address above. A notice will be delivered or mailed to me at a different address if I give the Note Holder a notice of my different address. Any notice that must be given to the Note Holder under this Note will be given by mailing it by certified mail to the Note Holder at the address stated in Section 3 above. A notice will be mailed to the Note Holder at a different address if I am given a notice of that different address. 9. RESPONSIBILITY OF PERSONS UNDER THIS NOTE If more than one person signs this Note, each of us is fully and personally obligated to pay the full amount owed and to keep all of the promises made in this Note. Any guarantor, surety, or endorser of this Note (as described in Section 8 above) is also obligated to do these things. The Note Holder may enforce its rights under this Note against each of us individually or against all of us together. This means that any one of us may be required to pay all of the amounts owed under this Note. Any person who takes over my rights or obligations under this Note will have all of my rights and must keep all of my promises made in this Note. Any person who takes over the rights or obligations of a guarantor, surety, or endorser of this Note (as described in Section 8 above) is also obligated to keep all of the promises made in this Note. 10. COPY RECEIVED Borrower hereby acknowledges receipt of a true copy of this instrument. 11. CONFESSION OF JUDGMENT BORROWER HEREBY IRREVOCABLE AUTHORIZES AND EMPOWERS ANY ATTORNEY OR THE PROTHONOTARY OR CLERK OF ANY COURT IN THE COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE, TO APPEAR AT ANY TIME FOR BORROWER AFTER A DEFAULT UNDER THIS NOTE AND WITH OR WITHOUT COMPLAINT FILED, CONFESS OR ENTER JUDGMENT AGAINST BORROWER FOR THE ENTIRE PRINCIPAL BALANCE OF THIS NOTE AND ALL ACCRUED INTEREST, LATE CHARGES AND ANY AND ALL AMOUNTS EXPENDED OR ADVANCED BY LENDER RELATING TO ANY COLLATERAL SECURING THIS NOTE, TOGETHER WITH COSTS OF SUITE, AND AN ATTORNEY'S COMMISSION OF TEN PERCENT (10%) OF THE UNPAID PRINCIPAL BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS ($500) ON WHICH JUDGMENT OR JUDGMENTS ONE OR MORE EXECUTIONS MAY ISSUE IMMEDIATELY; AND FOR SO DOING, THIS NOTE OR A COPY OF THIS NOTE VERIFIED BY AFFIDAVIT SHALL BE SUFFICIENT WARRANT. THE AUTHORITY GRANTED IN THIS NOTE TO CONFESS JUDGMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ANY EXERCISE OF THAT AUTHORITY, BUT SHALL CONTINUE FROM TIME TO TIME AND AT ALL TIMES UNTIL PAYMENT IN FULL OF ALL AMOUNTS DUE UNDER THIS NOTE. BORROWER HEREBY WAIVES ANY RIGHT BORROWER MAY HAVE TO NOTICE OR TO A HEARING IN CONNECTION WITH ANY SUCH CONFESSION OF JUDGMENT AND STATES THAT EITHER A REPRESENTATIVE OF LENDER SPECIFICALLY CALLED THIS CONFESSION OF JUDGMENT PROVISION TO BORROWER'S ATTENTION OR BORROWER HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL. RHOADS &, OARS PARTNERSHIP ?'A?,{?' (Seal) Witness: B . (Seal) By: Witn (Seal) ar 1,1L . oads, Partner J J'j-'e (Seal) oads, Individually V - GLt?L y: Debra L. ndividually xk?p s VERIFICATION The foregoing Complaint is based upon information which has been gathered by our counsel in the preparation of the lawsuit. The language of the document is that of counsel and not our own, We have read the document and to the extent that it is based upon information which we have given to our counsel, it is true and correct to the best of our knowledge, information and belief. To the extent that the content of the document is that of counsel, we have relied upon counsel in making this verification. This statement and verification are made subject to the penalties of 18 Pa. C.S. Section 4904 relating to unsworn falsification to authorities, which provides that if we make knowingly false averments, we may be subject to criminal penalties. Cindy Rh Debra L. Rhoads F TILE9iCUr, W12i58 RhmdA124,is I pVJudgmenr,wpd CERTIFICATE OF SERVICE I, Shelly R. Brooks, an authorized agent for Martson Law Offices, hereby certify that a copy of the foregoing Defendants' Petition to Open or Strike Confessed Judgment was served this date by depositing same in the Post Office at Carlisle, PA, first class mail, postage prepaid, addressed as follows: Samuel L. Andes 525 North Twelfth Street P.O. Box 168 Lemoyne, Pennsylvania 17043 MARTSON LAW OFFICES Bea ?% Shelly R. Br oks Ten East gh Street Carlisle, PA 17013 (717) 243-3341 Dated: April 30, 2008 .? _? . -:'? ' --1 ?.i `e .,, .a MAY 012001 Hubert X. Gilroy, Esquire Trudy E. Fehlinger, Esquire I.D. Nos. 29943 and 202753 MARTSON DEARDORFF WILLIAMS OTTO GILROY & FALLER MARTSON LAW OFFICES 10 East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Defendants LINDA MOWERY, IN THE COURT OF COMMON PLEAS OF Plaintiff, CUMBERLAND COUNTY, PENNSYLVANIA V. : NO. 2008-2530 CINDY RHOADS and DEBRA L. RHOADS, CIVIL ACTION - LAW individually, and CINDY RHOADS and DEBRA L. RHOADS, co-partners trading as RHOADS & RHOADS PARTNERSHIP, : CONFESSION OF JUDGMENT Defendants RULE TO SHOW CAUSE AND NOW, this day of ^ , 2008, upon consideration of the foregoing Petition to Open or Strike Confessed Judgment, it is hereby Ordered that: (1) a rule is issued upon the Respondent to show cause why the Petitioners are not entitled to the relief requested; (2) the Respondent shall file an Answer to the Petition within 4? O days of this date; (3) the Petition shall be decided under Pa.R.C.P. No. 206.7; (4) depositions shall be completed within 100 days of this date- X ?,• 30 .L , rv? (5) argument shall be held on in Courtroom , 4 of the Cumberland County Courthouse; (6) notice of the entry of this Order shall be provided to all,p?ies by the Petitioners; and (7) all proceedings relating to this matter sbe stayed nding resolution of the Petition. 3 J. Aoz?.I-p - 14 4tl - 3Yru .s T1tfj ,mow AJOD 19 N l? I .c NIJ S- All"I Goon un::? go1sIs 3'l i JO LINDA MOWERY, Plaintiff vs. CINDY RHOADS and DEBRA L. RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co- partners trading as RHOADS & RHOADS P A F TNFR S"IP, Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - EQUITY NO. 2008-2530 CONFESSION OF JUDGMENT PLAINTIFF'S ANSWER TO DEFENDANTS' PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND NOW comes the above-named Plaintiff, by her attorney, Samuel L. Andes, and makes the following Answer to Defendant's Petition: 1. Admitted. 2. Admitted. 3. Admitted. 4. Admitted. 5. Admitted. 6. Admitted. 7. Admitted. 8. Admitted. 9. Admitted. 10. Admitted. 11. No answer is required to the statements made in this Paragraph because they state conclusions of law. 12. No answer is required to the statements made in this Paragraph because they state conclusions of law. 13. No answer is required to the statements made in this Paragraph because they state conclusions of law. 14. No answer is required to the statements made in this Paragraph because they state conclusions of law. By way of further answer, Plaintiff denies that the statements in this Paragraph reflect a precise or accurate statement of the law. 15. No answer is required to the statements made in this Paragraph because they state conclusions of law. 16. No answer is required to the statements made in this Paragraph because they state conclusions of law. By way of further response, Plaintiff denies that the statements in this Paragraph reflect an accurate or precise statement of the law. 17. Plaintiff admits that Defendants made payments during that time but denies that all of the payments were made as due or in every month that the payments were due. 18. Denied. Plaintiff denies there was ever any "oral" agreement between the parties whereby Petitioner agreed to accept interest only payments from Defendants for an additional year. Plaintiff admits that the Promissory Note required Defendants to begin making payments of principal and interest on 1 March 2006 and Plaintiff denies that they made those payments as required. In fact, the Defendants did not make the payments of even $500.00 during the month of March and several months thereafter. When Defendants made payments they frequently asked Plaintiff to hold the checks for a month or more because the checks, when delivered, were not funded. 19. Denied. Although it is admitted that Defendants only made payments of $500.00, it is denied that there was any oral agreement between Plaintiff and Defendants which allowed them to make reduced payments. Plaintiff also denies that Defendants made the payments on time or on a regular monthly basis. Plaintiff states that she and her attorney advised Defendants during this time that their payments were to be $750.00 per month, because of the increased interest rate, and that Defendants did not respond to those demands and failed to make the payments that were owed at that time. Further, Plaintiff states that Defendants did not commence the payments of $750.00 per month until December of 2006 and, as a result, they owed additional interest of $250.00 per month for the months of March 2006 through November 2006, or additional interest in the amount of $2,250.00. 20. Denied. Defendants did not increase their monthly payments to $750.00 per month until December of 2006. Plaintiff denies that they paid the $250.00 shortfall in interest for the period between 1 March 2006 and December of 2006. Plaintiff demands proof that Defendants made those payments. 21. Admitted. 22. It is admitted that Defendants made payments of $1,015.00 per month but it is denied that they made eleven such payments for a total of $12,180.00 and is further denied that the payments they made were for intere^t end principal. To the contrary, the additional payments the Defendants made were properly applied by Plaintiff to the interest and late charges which the Defendants owed up to that time. 23. Plaintiff has received no payments from Defendant since March of 2008. 24. Denied as stated. Plaintiff's confession of judgment does not reflect the payments which Defendants claim they have made against the principal balance of the Note because there were no such payments. The additional payments which Defendants made commencing in May of 2007 were properly applied to back interest owed at that time and late charges owed at that time. 25. Denied. To the contrary, Defendants have failed to communicate with Plaintiff and her attorney regarding the problem, have failed to make payments as due under the Note, have failed to communicate with Plaintiff or her attorney to make any effort to resolve this matter, and have failed to take reasonable steps to obtain the financing necessary to pay the full balance of the debt owed to Plaintiff. 26. Admitted. By way of further answer, however, Defendants' attempts to sell the restaurant do not satisfy or acquit their responsibility to pay Plaintiff the amount she is owed in accordance with the Promissory Note. 27. Denied. The attorneys commission is an express term of the agreement between the parties as secured by the Secondary Mortgage Loan Promissory Note. It was a bargained-for payment which the Defendants agreed to make in the event of their default. As such, it is neither unreasonable or unconscionable in light of the work that has been done or remains yet to be done by Plaintiff's attorney to protect Plaintiff's rights. 28. Denied for the reasons set forth in the answer to Paragraph 27 above. 29. Denied. Plaintiff's attorney has worked on this matter for a period of more than two years and he has devoted to the matter repeated efforts to obtain a response or cooperation from Defendant and their counsel. Moreover, Plaintiff anticipates significant fees to litigate this case to a final judgment and collection because of Defendants' demonstrated attempt to avoid the debt and refusal to cooperate with Plaintiff and her attorney. 30. Denied for the reasons set forth in Paragraphs 27 and 29 above. 31. Admitted. 32. Admitted. WHEREFORE, Plaintiff prays this court to dismiss Defendants' Petition and confirm the judgment entered against them by confession so this matter may be concluded and Plaintiff's rights can be protected. Samuel L. Andes Attorney for Plaintiff Supreme Court ID # 17225 P.O. Box 168 Lemoyne, Pa 17043 (717) 76i-5361 CERTIFICATE OF SERVICE I hereby certify that I served a copy of the foregoing document upon counsel for the Defendant by regular mail, postage prepaid, addressed as follows: Hubert X. Gilroy, Esquire 10 East High Street Carlisle, PA 17013 Date: 30 May 2008 IAC4-kli Amy M. rkins Se etary for Samuel L. Andes c:.? 1: 'Ti .. ,::y --1 ;,-- _ ? S t`J - ? ?? ??,1 ::?{ __, :a- r a LINDA MOWERY, Plaintiff VS. CINDY RHOADS and DEBRA L. RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co- partners trading as RHOADS & RHOADS PARTNERSHIP, Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - EQUITY NO. 2008-2530 CONFESSION OF JUDGMENT PLAINTIFF'S ANSWER TO DEFENDANTS' PETITION TO OPEN OR STRIKE CONFESSED JUDGMENT AND NOW comes the above-named Plaintiff, by her attorney, Samuel L. Andes, and makes the following Answer to Defendant's Petition: 1. Admitted. 2. Admitted. 3. Admitted. 4. Admitted. 5. Admitted. 6. Admitted. 7. Admitted. 8. Admitted. 9. Admitted. 10. Admitted. 11. No answer is required to the statements made in this Paragraph because they state conclusions of law. 12. No answer is required to the statements made in this Paragraph because they state conclusions of law. 13. No answer is required to the statements made in this Paragraph because they state conclusions of law. 14. No answer is required to the statements made in this Paragraph because they state conclusions of law. By way of further answer, Plaintiff denies that the statements in this Paragraph reflect a precise or accurate statement of the law. 15. No answer is required to the statements made in this Paragraph because they state conclusions of law. 16. No answer is required to the statements made in this Paragraph because they state conclusions of law. By way of further response, Plaintiff denies that the statements in this Paragraph reflect an accurate or precise statement of the law. 17. Plaintiff admits that Defendants made payments during that time but denies that all of the payments were made as due or in every month that the payments were due. 18. Denied. Plaintiff denies there was ever any "oral" agreement between the parties whereby Petitioner agreed to accept interest only payments from Defendants for an additional year. Plaintiff admits that the Promissory Note required Defendants to begin making payments of principal and interest on 1 March 2006 and Plaintiff denies that they made those payments as required. In fact, the Defendants did not make the payments of even $500.00 during the month of March and several months thereafter. When Defendants made payments they frequently asked Plaintiff to hold the checks for a month or more because the checks, when delivered, were not funded. 19. Denied. Although it is admitted that Defendants only made payments of $500.00, it is denied that there was any oral agreement between Plaintiff and Defendants which allowed them to make reduced payments. Plaintiff also denies that Defendants made the payments on time or on a regular monthly basis. Plaintiff states that she and her attorney advised Defendants during this time that their payments were to be $750.00 per month, because of the increased interest rate, and that Defendants did not respond to those demands and failed to make the payments that were owed at that time. Further, Plaintiff states that Defendants did not commence the payments of $750.00 per month until December of 2006 and, as a result, they owed additional interest of $250.00 per month for the months of March 2006 through November 2006, or additional interest in the amount of $2,250.00. 20. Denied. Defendants did not increase their monthly payments to $750.00 per month until December of 2006. Plaintiff denies that they paid the $250.00 shortfall in interest for the period between 1 March 2006 and December of 2006. Plaintiff demands proof that Defendants made those payments. 21. Admitted. 22. It is admitted that Defendants made payments of $1,015.00 per month but it is denied that they made eleven such payments for a total of $12,180.00 and is further denied that the payments they made were for interest and principal. To the contrary, the additional payments the Defendants made were properly applied by Plaintiff to the interest and late charges which the Defendants owed up to that time. 23. Plaintiff has received no payments from Defendant since March of 2008. 24. Denied as stated. Plaintiff's confession of judgment does not reflect the payments which Defendants claim they have made against the principal balance of the Note because there were no such payments. The additional payments which Defendants made commencing in May of 2007 were properly applied to back interest owed at that time and late charges owed at that time. 25. Denied. To the contrary, Defendants have failed to communicate with Plaintiff and her attorney regarding the problem, have failed to make payments as due under the Note, have failed to communicate with Plaintiff or her attorney to make any effort to resolve this matter, and have failed to take reasonable steps to obtain the financing necessary to pay the full balance of the debt owed to Plaintiff. 26. Admitted. By way of further answer, however, Defendants' attempts to sell the restaurant do not satisfy or acquit their responsibility to pay Plaintiff the amount she is owed in accordance with the Promissory Note. 27. Denied. The attorneys commission is an express term of the agreement between the parties as secured by the Secondary Mortgage Loan Promissory Note. It was a bargained-for payment which the Defendants agreed to make in the event of their default. As such, it is neither unreasonable or unconscionable in light of the work that has been done or remains yet to be done by Plaintiff's attorney to protect Plaintiff's rights. 11 28. Denied for the reasons set forth in the answer to Paragraph 27 above. 29. Denied. Plaintiff's attorney has worked on this matter for a period of more than two years and he has devoted to the matter repeated efforts to obtain a response or cooperation from Defendant and their counsel. Moreover, Plaintiff anticipates significant fees to litigate this case to a final judgment and collection because of Defendants' demonstrated attempt to avoid the debt and refusal to cooperate with Plaintiff and her attorney. 30. Denied for the reasons set forth in Paragraphs 27 and 29 above. 31. Admitted. 32. Admitted. WHEREFORE, Plaintiff prays this court to dismiss Defendants' Petition and confirm the judgment entered against them by confession so this matter may be concluded and Plaintiff's rights can be protected. Samuel L. Andes Attorney for Plaintiff Supreme Court ID # 17225 P.O. Box 168 Lemoyne, Pa 17043 (717) 761-5361 CERTIFICATE OF SERVICE I hereby certify that I served a copy of the foregoing document upon counsel for the Defendant by regular mail, postage prepaid, addressed as follows: Hubert X. Gilroy, Esquire 10 East High Street Carlisle, PA 17013 a Date: 30 May 2008 Amy M. kips Se etary for Samuel L. Andes F:\FILES\Cfi=ts\12458 Rhoads\12458.1.orda.coWinuma.wpd Hubert X. Gilroy, Esquire Trudy E. Fehlinger, Esquire I.D. Nos. 29943 and 202753 MARTSON DEARDORFF WILLIAMS OTTO GILROY & FALLER MARTSON LAW OFFICES 10 East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Defendants LINDA MOWERY, V. IN THE COURT OF COMMON PLEAS OF Plaintiff, CUMBERLAND COUNTY, PENNSYLVANIA CINDY RHOADS and DEBRA L. RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co-partners trading as RHOADS & RHOADS PARTNERSHIP, Defendants NO. 2008-2530 CIVIL ACTION - LAW CONFESSION OF JUDGMENT ORDER AND NOW, this Xday of ?Vj? , 2008, upon agreement of counsel for - 14- Plaintiff Linda Mowery and counsel fo Defendants Cindy and Debra L. Rhoads, individually and co-partners trading as Rhoads & Rhoads Partnership, the argument scheduled for Monday, July 21, 2008, at 9:30 a.m., before the Honorable Edward E. Guido, on Defendants' Petition to Open or Strike Confessed Judgment is hereby continued until such time as a request is made by either counsel to have the matter rescheduled. J. LNrl.f C? wd V Z- I p Co4Z r LINDA MOWERY, Plaintiff VS. CINDY RHOADS and DEBRA L. RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co- partners trading as RHOADS & RHOADS PARTNERSHIP, Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - EQUITY NO. 2008-2530 CONFESSION OF JUDGMENT ORDER OF COURT AND NOW this day of JULY 2008, upon the request and concurrence of both parties, we hereby continue generally the hearing we scheduled for July 21, 2008. The court will reschedule that hearing upon the request of either party if the parties are not able to resolve this matter by agreement. J. Distribution: Samuel L. Andes, Esquire (Attorney Plaintiff) 525 North 12th Street, P.O. Box 168, Lemoyne, PA 17043 Hubert X. Gilroy, Esquire (Attorney for Defendants) 10 East High Street, Carlisle, PA 17013 Opt les ma-1 Licc t;Z/608 71 VINVAWSNN]d mno 9 Z :6 WV ZZ Ifif BE Ai?1GI1 3N1 3U 3i _ --0311J LINDA MOWERY, IN THE COURT OF COMMON Plaintiff PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA vs. CIVIL ACTION—EQUITY CINDY RHOADS and DEBRA L. NO. 2008-2530 RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co- MCO Partners trading as RHOADS&RHOADS CONFESSION OF JUDGMENT CD PARTNERSHIP, —:Z: Defendants r X'0 PRAECIPE TO THE PROTHONOTARY: Please withdraw my appearance previously entered on behalf of Plaintiff, Linda Mowery, in the above captioned action. 4 Avwk, 2z DATE Sam , quire 525 North Twelfth Street P.O. Box 168 Lemoyne,PA 17043 Please enter my appearance on behalf of Plaintiff, Linda Mowery, in the above captioned action. I I Sid DATE 6 e squire t 0 r ZW 0 No. 34349 G IE&ASSOCIATES,P.C. 200 North Hanover Street Carlisle,PA 17013 (717)243-5551 8FAR1.E Thents\12458 Rhoads\12458,1\12459.1.Motion.wvdue Hubert X Gilroy,Esquire rn CD =M -V I.D.No. 29943 =70 :U 7-nr- — --"j C:) MARTSON DEARDORFF WILLIAMS OTTO GILROY&FALLER _ `7' MARTSON LAW OFFICES 10 East High Street >C-) :zc:) .—f— Carlisle, PA 17013 7>5E (717)243-3341 CO Attorneys for Defendants LINDA MOWERY, IN THE COURT OF COMMON PLEAS OF Plaintiff, CUMBERLAND COUNTY, PENNSYLVANIA V. NO. 2008-2530 CINDY RHOADS and DEBRA L.RHOADS, CIVIL ACTION-EQUITY individually, and CINDY RHOADS and DEBRA L. RHOADS, co-partners trading as RHOADS & RHOADS PARTNERSHIP, : CONFESSION OF JUDGMENT Defendants PRIOR JUDGE: The Honorable Edward E. Guido MQT10 N FQR SCHEDULING OF HEARING TO DETERAUNE AURQUUIE AMOUNT QF aMfiKMEN1/M0K1GAGE PAYOFF AM HEARING TO RMRMINE DAMAGES OWING TO DEFENDANTS BY MAMI"PIMUAM To 15 U.S. C. SECTION 1639 ET SEQ. Defendants,Cindy Rhoads and Debra L.Rhoads,individually,and as co-partners trading as Rhoads & Rhoads Partnership, by and through their attorneys, MARTSON LAW OFFICES, sets forth the following: 1. In August of 2002, as part of a transaction whereby Plaintiff, Linda Mowery, formerly,Linda Sedell, sold real estate and business assets to Cindy Rhoads and Debra L.Rhoads, individually and co-partners trading as Rhoads&Rhoads Partnership(Defendants),Defendants gave Plaintiff a Promissory Note (hereinafter referred to as the "Note")in the original amount of $100,000.00, and also gave Plaintiff a Mortgage on real estate that was sold to Defendant Rhoads &Rhoads Partnership located at I Pine Grove Road Gardners,PA 17324(hereinafter referred to as the"Real Estate"). 2. On April 21, 2008 at the above captioned term and number, Plaintiff filed a Confession of Judgment and a Complaint for Confession of Judgment on the Defendants with respect to the mentioned Note. 3. On April 30,2008,Defendants filed a Petition to Open and Strike the Confessed Judgment alleging that the calculation of the amount was incorrect and various other defenses. 4. On May 5,2008,the Honorable Edward E. Guido issued a Rule to Show Cause on the Plaintiff,directing the Plaintiff to file an Answer to the Petition and scheduled argument on the Petition. 5. On May 30, 2008, Plaintiff filed an Answer to the Petition to Open or Strike the Confessed Judgment. 6. By agreement of the parties, The Honorable Edward E. Guido entered an Order on July 1, 2008, continuing the argument scheduled for July 21, 2008, generally until such time as a request was made by counsel for either party to have the matter rescheduled. 7. By Order of July 21,2008,The Honorable Edward E.Guido generally continued the hearing that had been scheduled for July 21, 2008, with the hearing to be rescheduled upon the request of either party if the parties are unable to resolve the matter by agreement. 8. Except for the above,there were no other filings made of record in this case. 9. After July of 2008,the parties informally exchanged some discovery in connection with providing information for purposes of appropriately calculating monies owed by Defendants to Plaintiff. Additionally,Plaintiff took the deposition of Defendant Cindy Rhoads and Defendant Debra Rhoads on October 27, 2010. 10. The Defendants were continually marketing for sale the Real Estate in the hopes that the Real Estate would be sold and the monies owed to the Plaintiff would be paid. Defendants continually made payments on the debt owed to the Plaintiff 11, Plaintiff has not taken any action to enforce the Confession of Judgment for over four years. 12. In or about February of 2013,Defendants entered into an Agreement of Sale for the sale of the Real Estate which was subject to the Mortgage and the Judgment Note. Defendants personally and through legal counsel continuously requested verbally,in writing and via email,that the Plaintiff provide Defendants with a payoff figure in order to satisfy the Mortgage and Judgment Note and proceed with the sale of the Real Estate. IAA�AA 13. Despite repeated requests,Plaintiff refused to provide the Defendants with a payoff figure in order for Defendants to proceed with the sale of the Real Estate. 14. In an effort to accommodate Plaintiff s concern to insure the Plaintiff was paid the full amount owing to her,Defendants offered to escrow the entire sum of proceeds of settlement in the neighborhood of$140,000.00 in return for Plaintiff executing a Mortgage and Judgment release. Plaintiff adamantly refused to accommodate Defendants' requests and continued to attempt to torpedo Defendants sale of the Real Estate by refusing to provide a payoff. 15. Defendants aver that Plaintiff deliberately attempted to cause the termination of Defendants' sale of the Real Estate to the detriment of the Defendants, and this is the reason why Plaintiff has failed to provide a payoff figure. 16. Defendants proceeded with the sale of the Real Estate on March 14, 2013,with an agreement with the purchaser of the Real Estate that provided for the proceeds ofthe sale,consisting of approximately $140,000.00, to be escrowed with Martson Law Offices, in order to insure the payment of the debt owing to Plaintiff. 17. The Real Estate remains subject to the Mortgage and Judgment of the Plaintiff,and the new purchaser of the real Estate is unable to proceed with financing of a loan in order to do improvements on the Real Estate and also currently owns the Real Estate subject to the cloud of title relating to the mentioned Mortgage and Judgment Note. 18, Despite repeated requests from Defendants' counsel to Plaintiff s counsel, Plaintiff still refuses to provide a payoff. Additionally,Plaintiff is attempting to assess inappropriate interest charges and penalty charges in connection with the loan. 19. Plaintiff had an obligation pursuant to 15 U.S.C. Section 1639 et seq. to provide Defendants with an accurate payoff balance of the loan within seven(7)days of request,and Plaintiff has violated her obligations pursuant to said statute. 20. Pursuant to 15 U.S.C. Section 1640,Plaintiff is liable for damages sustained by the defendants as a result of Plaintiff's failure to provide an accurate payoff statement as requested which damages shall include twice the amount of finance charges in connection with the transaction, cost of the litigation and reasonable attorney's fees as determined by the Court. WHEREFORE,Defendants respectfully request that this Honorable Court schedule a hearing to determine as follows: A. The accurate payoff of the Note and Mortgage in question. B. Damages owing from Plaintiff to Defendants as a result of Plaintiff's actions as outlined above. MARTSON LAW OFFICES sy Hubert X. roy, Esquire I.D. No. 29943 10 East High Street Carlisle, PA 17013 (717)243-3341 Date: April , 2013 Attorney for Defendants LINDA MOWERY, IN THE COURT OF COMMON Plaintiff PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA vs. (A� C= CIVIL ACTION-EQUITY ­0Z Mr CINDY RHOADS and DEBRA L. NO. 2008-2530 T3 RHOADS, individually, and CINDY RHOADS and DEBRA L. RHOADS, co- Zn- Partners trading as RHOADS &RHOADS CONFESSION OF JUDGMENT :x PARTNERSHIP, C-71 Defendants Prior Judge: Edward E. Guido PETITION TO SCHEDULE A HEARING AND NOW comes Petitioner, Linda Mowery, by and through her counsel of record, Bradley L. Griffie, Esquire, and the law firm of Griffie & Associates, P.C. and petitions the Court as follows: 1. Petitioner is Linda Mowery, an adult individual currently represented by Bradley L. Griffie,Esquire, and the law firm of Griffie&Associates, P.C. of 200 North Hanover Street, Carlisle, Cumberland County,Pennsylvania. 2. Respondents are Cindy Rhoads and Debra L. Rhoads, individually and as co-partners trading as Rhoads and Roads, adult individuals currently represented by Hubert X. Gilroy, Esquire and Martson Law Offices, of 10 East High Street, Carlisle, Cumberland County,Pennsylvania. 3. The instant action was initiated with the filing of a Complaint in Confession of Judgment on April 21, 2008 by your Petitioner herein. 4. A Petition to Open or Strike confessed Judgment was filed by the above named Respondents on or about April 30, 2008. 5. Upon the filing of the Petition to Open or Strike Confessed Judgment, a Rule was entered upon the Petitioner to respond to the Petition and a hearing on this matter was scheduled for July 21, 2008 at 9:30 a.m. in Courtroom Number 3 of the Cumberland County Courthouse. 6. Petitioner filed her Answer to the Respondent's Petition to Open or Strike Confessed Judgment on or about June 2,2008. 7. By agreement of the counsel and the parties, the hearing scheduled for July 21,2008 was continued generally. 8. Since the filing of the referenced pleadings, the parties have been unable to resolve the issue of Petitioner receiving payment in full from the Respondents for the sums due on the Note which forms the basis for the Confession of Judgment. 9. Respondents have sold the principle parcel of real estate and business at issue in this matter to a third party purchaser for value. 10. The sale of the real estate and business was done under circumstances wherein a mortgage encumbrance continues to be open in favor of Petitioner and the Confession of Judgment action continues to be a lien on the subject real estate. 11. Petitioner has provided Respondent with a payoff figure to pay the total sums due and owing on the Note which forms the basis for the Confession of Judgment,but payment has not been forthcoming. 12. Respondents refuse to pay the sums due to pay the Judgment due in full and, therefore, the Judgment continues to be a lien on the real estate that has been sold to a third party purchaser for value and will continue to be a lien on that property until payment is made in full by the Respondents to the Petitioner. 13. Petitioner intends to move forward with execution on the Judgment entered on the Note, but the issue of the Petition to open Judgment must be resolved before Petitioner can proceed. 14. Respondents continue to be represented by Hubert X. Gilroy, Esquire who has been provided with a copy of this Petition prior to the filing and who concurs in the request for a hearing to be scheduled in this matter. WHEREFORE, Petitioner requests your Honorable Court to schedule a hearing on the pleadings in this matter. Respectfully Submitted, ffie, Esquire ounsel for Plaintiff Supreme Court ID No. 34349 GRIME &ASSOCIATES, P.C. 200 North Hanover Street Carlisle, PA 17013 (717)243-5551 VERIFICATION I verify that the statements made in the foregoing document are a and correct. I understand that false statements herein are made subject to the penalties of 18 C.S. Section 4904,relating to unworn falsifications to authorities. r l DATE: LINDA MOB Y, Pl ff t LINDA MOWERY, ) IN THE COURT OF COMMON Plaintiff ) PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA VS. ) CIVIL ACTION—EQUITY CINDY RHOADS and DEBRA L. ) NO. 2008-2530 RHOADS, individually, and CINDY ) RHOADS and DEBRA L. RHOADS, co- ) Partners trading as RHOADS &RHOADS ) CONFESSION OF JUDGMENT PARTNERSHIP, Defendants CERTIFICATE OF SERVICE I, Bradley L. Griffie, Esquire, hereby certify that I did, the day of April. 2013, cause a copy of Plaintiffs Petition to Schedule a Hearing to be served upon Defendants by serving their attorney of record, Hubert X. Gilroy, Esquire, by facsimile and by first-class mail,postage prepaid at the following address: Hubert X. Gilroy,Esquire Martson Law Offices 10 East High Street Carlisle, PA 17013 Facsimile: (717)243-1850 DATE: Griffie, Esquire ey for Plaintiff S me Court ID No. 34349 GRIFFIE&ASSOCIATES, P.C. 200 North Hanover Street Carlisle,PA 17013 (717)243-5551 (800)347-5552 F;L.E0-Or;7 Hubert X. Gilroy, Esquire ­F PIzOTHIONtOli"�i;�f I.D. No. 29943 MARTSON DEARDORFF WILLIAMS OTTO GILROY & FALLER 2013 APR 17 PM 3: 26, MARTSON LAW OFFICES 'NMBE-HLAND COU14TY 10 East High Street PENNSYLVANIA Carlisle, PA 17013 (717) 243-3341 Attorneys for Defendants LINDA MOWERY, IN THE COURT OF COMMON PLEAS OF Plaintiff, CUMBERLAND COUNTY, PENNSYLVANIA V. NO. 2008-2530 CINDY RHOADS and DEBRA L. RHOADS, CIVIL ACTION - LAW individually, and CINDY RHOADS and DEBRA L. RHOADS, co-partners trading as RHOADS & RHOADS PARTNERSHIP, : CONFESSION OF JUDGMENT Defendants PRIOR JUDGE: The Honorable Edward E. Guido ORDER AND NOW,this�y of^y ,7 , 2013, upon consideration of the attached Motion, it is hereby Ordered and directed as follows: 1. A hearing is scheduled in Courtroom No. 3 of the Cumberland Courthouse on the 2eday of , 2013, at /•W P—. m. at which time testimony will be taken in connection with the attached Motion of Defendants. 2. In an effort to resolve this matter in an expeditious fashion, a conference in Chambers is scheduled with legal counsel for the parties in advance of the above mentioned hearing on the ��)day of 2013, at //'o A. M. Edward E. Gudio, J dge �Distrubition: ✓ �Iubert X. Gilroy, Esquire /$' uel L. Andes, Esquire ,/Bradley L. Griffie, Esquire UJ/U1/L.U1J 1:J:U - 1'NN\1 VV11 L."In Vi 1 1vL.,,l Bradley L. Griffie, Esquire , _ r: , ID# 3'134 3 OF HE PROTHO "-TARY 200 North Hanover Street Carlisle,PA 17013 2 1-3 APR 2S Phi (717)243-5551 Attorney for Plaintiff CUMBERLAND COUNTS LINDA MOWERY, PEtVSYI.V ►ti : IN THE COURT OF COMMON PLEAS OF Plaintiff : COUNTY,PENNSYLVANIA V. NO.2008-2530 CINDY RHOADS,DEBRA L.RHOADS CIVIL ACTION-LAW and RHOADS&RHOADS PARTNERSHIP, Defendants `u PRAECIPE TO THE PROTHONOTARY; Please enter my appearance on behalf of the Plaintiff in the above matter. Please mark the Judgment entered in the above matter as satisfied in full,and mark this action settled and discontinued. �Br 3 ;EsgGire 4g 00 N. Hanover Street Carlisle,PA 17013 (717)243-5551 i