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HomeMy WebLinkAbout02-2316 CivilDOUGLAS P. REED V. T1NA M. REED IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA NO. 2002-2316 CIVIL TERM IN RE: OPINION PURSUANT TO Pa. R.A.P. 1925 Guido, J., AUGUST ,2002 Plaintiff confessed judgment against defendant by complaint filed on May 10, 2002. Defendant timely filed a petition to open the judgment. We issued a rule upon plaintiff to show cause why the judgment should not be opened. Plaintiff filed an answer after which defendant filed an amended petition to open. On July 9, 2002, we denied the defendant' s request to open the judgment. This appeal followed. The Pennsylvania Rules of Civil Procedure set forth the mandatory procedures to be followed in connection with the opening of a confessed judgment. See Magee v. d. G. Wentworth Company, Inc., 761 A.2d 159 (Pa. Super. 2000). Rule 2959 provides in relevant part as follows: (a)(1) (b) (c) (e) Relief from a judgment by confession shall be sought by petition. (A)II grounds for relief whether to strike off the judgment or to open it must be asserted in a single petition. 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. After being served with a copy of the petition the plaintiff shall file an answer on or before the return day of the rule. A party waives all defenses and objections which are not included in the petition or answer. The court shall dispose of the rule on petition and answer, and on any testimony, deposition, admissions and other evidence. If evidence is produced which in a jury trial would require the issues to be submitted to the jury the court shall open the judgment. 2002-2316 CIVIL Our appellate courts have set forth the standard to be employed in determining whether to open a confessed judgment. As the Superior Court noted: Traditionally, a confessed judgment will be opened in only a limited number of circumstances, and only when the person seeking to open acts promptly, alleges a meritorious defense and presents sufficient evidence of that defense to require submission of the issues to the jury. In making such a determination, the court employs the same standard as that of the directed verdict--"viewing all the evidence in the light most favorable to the petitioner and accepting as true all evidence and proper inferences therefrom supporting the defense while rejecting adverse allegations of the party obtaining the judgment." Rule 2959 (e) of the Pennsylvania Rules of Civil Procedure provides that "in a proceeding to open a confessed judgment, if evidence is produced which, in a jury trial, would require the issues to be submitted to the jury, the court shall open the judgment." PaR. CP. 2959 (e) has been interpreted to require the judgment debtor to offer clear, direct, precise and "believable" evidence of its meritorious defense. (citations omitted) Iron Worker's Savings and Loan v. IWS, Inc., 424 Pa. Super. 255, 622 A.2d 367, 370, (1993). Applying the above law to the case before us, we determined that appellant's petition to open should be denied. The facts of this case may be summarized as follows. The parties were divorced by a decree entered in the Court of Common Pleas of Lebanon County on December 16, 1997.~ The decree incorporated a marital settlement agreement dated November 26, 1997.2 Paragraph 10 of the agreement provided as follows: Wife agrees to be solely liable for the loan at Member's First, loan number 14167. Said loan is currently in Husband's name. Nonetheless, Wife agrees to assume responsibility for the payment of the unpaid balance, together with interest thereon, and hereby agrees to hold Husband free and harmless from any and all liability as a result of non-payment of the loan by her. Should Wife default and it becomes necessary for Husband to pay any amount as a result of her liability on the loan, Wife authorizes and empowers any Prothonotary, Clerk or Attorney of any Court of Record within the United States or elsewhere to appear for her and with or without Petition to Open Exhibit E. Petition to Open Exhibit E. 2002-2316 CIVIL declaration, to confess judgment at any time against her and in favor of Husband for the above sum plus interest thereon, with costs of suit and an attorney's commission of fifteen percent for collection.3 Defendant defaulted on the Member's First Loan and plaintiff was required to pay the balance in full.4 As a result of defendant's default, plaintiff filed a petition for contempt in the Court of Common Pleas of Lebanon County.5 In May of 2001, the Honorable Bradford Charles scheduled a hearing in connection with plaintiff s petition as well as a separate contempt petition which had been filed by defendant. The relevant portion of the Court's order provided as follows: ORDER AND NOW, to wit, May 8, 2001, after hearing and in consideration of the testimony adduced, the findings of this Court are as follows: A. Plaintiff did not appear or present any information relative to the Motion for Contempt filed by Plaintiff which related to the alleged payment of $1,106.48 in satisfaction of Member's First Loan. O. The Court finds that the Plaintiff breached the Property Settlement Agreement by improperly taking possession of the Pontiac vehicle as outlined above. Accordingly, after consideration of all the facts and circumstances presented, including those mentioned above, the Order of this Court is as follows: 1. The Plaintiff s Motion for Contempt is respectfully refused. ~ Petition to Open Exhibit D. 4 Complaint paragraphs 9-10, and Exhibit B. We note that defendant did not dispute these allegations in her petition to open judgment. While her amended petition contained an allegation that the loan was not in default at the time it was paid by plaintiff, the allegation was not accompanied by any supporting documentation to counter the default notice and payment receipt attached as Exhibit B to the complaint. Therefore, we did not feel that the allegation amounted to "clear, direct, precise and believable evidence of (a) meritorious defense." Iron Worker's, supra. However, there was an even more fundamental reason for us discounting plaintiff's "meritorious defense", i.e., it was not raised in her original petition and was, therefore, waived. See Pa.R.A.P. 2959(a)(1) and (c). s Petition to Open Exhibit "B". 2002-2316 CIVIL 2. The Defendant's Motion for Contempt is granted. The Plaintiff is directed to pay the sum of $2,150 to the Defendant within 90 days from today' s date. The defendant advanced two arguments in support of her petition to open. In the first instance, she contended that Judge Charles' Order of May 8, 2001, operated as res judicata in connection with the issue of the Member's First Loan. In addition, she argued that plaintiffs' action to confess judgment should have been filed in Lebanon County, where the divorce decree was entered, rather than Cumberland County. We did not agree with either contention. If it is applicable, the doctrine of res judicata precludes the litigation "of claims and issues that have previously been litigated." Chada v. Chada, 756 A.2d 39, 42 (Pa. Super. 2000). To be applicable, there must, at the very least, be a "final judgment on the merits." Id In the instant case, Judge Charles' order was not such a judgment. He never addressed the merits. He simply dismissed the contempt petition as a result of the plaintiff' s failure to appear or to present any evidence on the issue. In effect, the action was dismissed because of plaintiff' s failure to prosecute. "Since a judgment of non pros is not a judgment on the merits, it cannot have resjudicata effect." Hatchigian v. Koch, 381 Pa. Super. 377, 381 553 A.2d 1018, 1020 (1989). Defendant next argued that the "proper forum for raising the issue of the Member's First payment" should be Lebanon County.6 This contention is based upon the fact that the "Marital Settlement Agreement was incorporated into the parties' Divorce Decree in Lebanon County".? However, the agreement specifically allows the confession Petition to Open, paragraph 5B (iii). Petition to Open, paragraph 5B (ii). 2002-2316 CIVIL of judgment to be entered in "any Court of Record within the United States or elsewhere.''8 Since the defendant lives in Cumberland County, it is only logical that plaintiff would institute the confession of judgment proceedings in this county. This is clearly authorized by the parties' agreement. In view of the above, we were satisfied that defendant's petition did not raise sufficient grounds to justify the opening of the confessed judgment. Therefore, we denied it. DATE Edward E. Guido, J. Kathy M. Shughart, Esquire For the Plaintiff Peter B. Foster, Esquire For the Defendant :sld 8 Petition to Open, Exhibit D, paragraph 10.