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Home My WebLink About2010-1385 Civil PNC BANK, NATIONAL : IN THE COURT OF COMMON PLEAS OF ASSOCIATION, Successor to : CUMBERLAND COUNTY, PENNSYLVANIA Pennsylvania State Bank, a division : Of BLC Bank, N.A., : PLAINTIFF : : V. : : WILLIAM C. KOLLAS, : DEFENDANT : 10-1385 CIVIL TERM IN RE: DEFENDANT’S PETITION TO STRIKE OR OPEN CONFESSED JUDGMENT BEFORE MASLAND, J. OPINION AND ORDER OF COURT Masland, J., July 14, 2010:-- Plaintiff, PNC Bank, initiated the instant matter by filing a complaint for confession of judgment against defendant, William C. Kollas, on February 25, 2010. On March 26, 2010, defendant filed a petition to strike or open the confessed judgment. Following briefing by the parties and oral argument, the court now denies defendant's petition. Defendant’s petition presents several grounds for striking or opening the confessed judgment. First, plaintiff breached contractual duties owed to defendant when it impermissibly accelerated the loan agreement at issue. Second, the confession of judgment includes an unauthorized attorney commission. Third, the confession of judgment lists inaccurate damages. Fourth, the Guaranty is identified by an erroneous date. These issues lack merit. 10-1385 CIVIL TERM I. Petition to Strike In support of his petition to strike, defendant identifies three defects on the face of the complaint for confession of judgment: (1) the confession of judgment includes an unauthorized attorney commission; (2) the confession of judgment lists inaccurate damages; and (3) the copy of the Guaranty attached to the complaint for confession of judgment contains an erroneous date. A petition to strike a confessed judgment presents a question of law and “will only be granted if a fatal defect appears on the face of the record.” RAIT Partnership, LP v. E Pointe Properties I, Ltd., 957 A.2d 1275, 1277 (Pa. Super. 2008). Where, as here, the proceeding was initiated by complaint, the complaint and the confession of judgment clause must be read together to determine whether there are defects on the face of the record. Crum v. F.L. Shaffer Co., 693 A.2d 984, 986 (Pa. Super. 1997). A review of the record reveals no such defects. Defendant’s argument that the attorney commission is unauthorized lacks merit. First, our Superior Court has approved the inclusion of collection commission provisions in contracts. RAIT, 957 A.2d at 1279. Second, the confession of judgment provision of the promissory note at issue authorizes, in relevant part, AN ATTORNEY’S COMMISSION OF TEN PERCENT (10%) OF THE UNPAID BALANCE AND ACCRUED INTEREST FOR COLLECTION, BUT IN ANY EVENT NOT LESS THAN FIVE HUNDRED DOLLARS ($500). Pl. Ex. D (emphasis added) (caps in original). Third, the itemized computation of defendant’s debt lists principal owed in the amount of $1,109,578.99, interest in -2- 10-1385 CIVIL TERM the amount of $3,012.82, and attorneys’ fees in the amount of $112,591.18. Compl. at ¶10. Basic arithmatic reveals the sum of defendant’s debt on the principal and interest is $1,112,591.19, ten percent of which, is $112,591.19. Thus, plaintiff’s request for attorneys’ fees of $112,591.18 is clearly proper. Defendant’s second alleged defect on the record relates to allegedly inaccurate damages. The entirety of defendant’s argument in his petition on this issue reads: 14. Plaintiff has failed to provide any accounting of the alleged principal balance interest owed. 15. [Defendant] disputes the alleged amount owed and demands proof thereof at trial. Pet. at 3. Again, a review of the record indicates the amount listed in the exhibits attached to the complaint is identical to the amount listed in the complaint for confession of judgment itself. See Ex. D (Pl.’s demand for payment, dated February 19, 2010). Finally, defendant points to two instances where the Guaranty at issue refers to erroneous dates. A review of the record indicates these erroneous dates are errors on the face of the record. Nonetheless, they are insufficient to justify striking the confessed judgment. Where, as here, an error is technical rather than prejudicial, the court will not strike a confessed judgment. Atlantic National Trust v. Stivala Investments, 922 A.2d 919, 923 (Pa. Super. 2007). Despite two erroneously transcribed dates, the loan documents list a consistent loan number throughout. As such, defendant cannot claim the error renders him incapable of verifying the identity of the Guaranty at issue here or that it prejudices him in any way. Accordingly, the errors are de minimis flaws that do -3- 10-1385 CIVIL TERM not justify striking the confessed judgment. See One Penn Square Assocs. v. Happy Photo, Inc., 24 Phila. Co. Rptr. 360, 362 (1992), available at 1992 WL 1071412 (finding reference to erroneous date of document in complaint to be a de minimis error where copy of document was attached to complaint with correct date). Thus, there are no facial inaccuracies or defects on the record to justify striking the confessed judgment. For these reasons, the court denies defendant’s petition to strike the confessed judgment. II. Petition to Open Next, defendant asks the court to open the confessed judgment on the grounds that plaintiff violated contractual duties by improperly accelerating and demanding immediate payment of the debt at issue. In support, defendant attached copies of loan documents to his petition that include the violated contract provisions. A petition to open a confessed judgment rests within the court’s equitable discretion, and may be granted if the defendant: “(1) acts promptly, (2) alleges a meritorious defense, and (3) can produce sufficient evidence to require submission of the case to a jury.” RAIT, 957 A.2d at 1277. Here, defendant filed the petition within the allotted 30 day period and alleges the meritorious defense that plaintiff failed to adhere to contractual requirements necessary to demanding payment under the note at issue. However, defendant failed to produce sufficient evidence to justify opening the confessed judgment. All loan documents attached to the petition and all -4- 10-1385 CIVIL TERM allegations of bad faith clearly relate to different debts not at issue in the instant proceeding. Specifically, the allegedly violated contractual provision relates to a separate $11,000,000 line of credit, not the $4,000,000 promissory note that was the subject of the confessed judgment. Defendant failed to provide any relevant evidence to rebut the properly executed confession of judgment. As such, the court denies his petition to open the confessed judgment. III. Conclusion In sum, the court concludes: (1) defendant only identified de minimis errors on the face of the record which are insufficient to justify striking the confessed judgment, and (2) defendant's references to loans other than the instant Guaranty do not persuade the court to open the confessed judgment. Defendant's petitions are denied. ORDER OF COURT AND NOW, this day of July, 2010, defendant’s petition to strike IS DENIED. or open confessed judgment, By the Court, Albert H. Masland, J. Geoffrey S. Shuff, Esquire For Plaintiff Markian R. Slobodian, Esquire For Defendant :sal -5- PNC BANK, NATIONAL : IN THE COURT OF COMMON PLEAS OF ASSOCIATION, Successor to : CUMBERLAND COUNTY, PENNSYLVANIA Pennsylvania State Bank, a division : Of BLC Bank, N.A., : PLAINTIFF : : V. : : WILLIAM C. KOLLAS, : DEFENDANT : 10-1385 CIVIL TERM IN RE: DEFENDANT’S PETITION TO STRIKE OR OPEN CONFESSED JUDGMENT BEFORE MASLAND, J. ORDER OF COURT AND NOW, this day of July, 2010, defendant’s petition to strike IS DENIED. or open confessed judgment, By the Court, Albert H. Masland, J. Geoffrey S. Shuff, Esquire For Plaintiff Markian R. Slobodian, Esquire For Defendant :sal