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Home My WebLink About94-00154 Orphans'IN RE: ESTATE OF : IN THE COURT OF COMMON PLEAS OF ELMER CONRAD a/k/a : CUMBERLAND COUNTY, PENNSYLVANIA ELMER E. CONRAD, : ORPHANS' COURT DIVISION Deceased : NO. 1994-00154 IN RE: OBJECTIONS TO FIRST AND FINAL ACCOUNT BEFORE SHEELY, P.J., and OLER, J. DECREE NISI AND NOW, this 2~~ day of April, 1995, after careful consideration of the objections of Members lst'Federal Credit Union to the First and Final Account filed by the Administrator c.t.a. herein, and for the reasons stated in the accompanying Opinion, the objections are SUSTAINED. THIS DECREE NISI shall become a final decree unless a timely motion for post-trial relief is filed pursuant to Pennsylvania Rule of Civil Procedure 227.1. BY THE COURT, Diane G. Radcliff, Esq. 3448 Trindle Road Camp Hill, PA 17011 Attorney for the Estate John M. Eakin, Esq. Main and Market Streets Mechanicsburg, PA 17055 Attorney for the Objectant :rc IN RE: ESTATE OF : IN THE COURT OF COMMON PLEAS OF ELMER CONRAD a/k/a : CUMBERLAND COUNTY, PENNSYLVANIA ELMER E. CONRAD, : ORPHANS' COURT DIVISION Deceased : NO. 1994-00154 IN RE: OBJECTIONS TO FIRST AND FINAL ACCOUNT BEFORE SHEELY, P.J., and OLER, J. OPINION and DECREE NISI Oler, J. This case presents the issue of whether Section 5529(b) of the Judicial Code, which provides that an action on an instrument under seal must be commenced within 20 years, governs the time in which a certain creditor of decedent herein must file suit on a certain pair of notes signed by decedent.~ For the reasons stated in this Opinion, the question will be answered in the affirmative. STATEMENT OF FACTS On February 3, 1995, a first and final account and statement of proposed distribution were filed by the administrator c.t.a, in the above-captioned estate. On March 3, 1995, objections to the account were filed by Members 1st Federal Credit Union. The basis for the objections was that no payment to the objectant on two loans of the decedent was proposed; in this regard, the accountant relied upon an alleged running of the statute of limitations. By Order of the Honorable Harold E. Sheely on March 22, 1995, the matter was directed to be listed for argument on the basis of a stipulated set of facts.2 The facts as stipulated by the parties ~ See Stipulated Facts in Re: Exceptions to Administrator's Account. 2 Opinion and Order of Court, March 22, 1995. NO. 94-0154 ORPHANS' COURT are as follows: 1. Elmer E. Conrad borrowed $5,445.84 from DAFCU on March 15, 1986 and executed a note to secure the debt. He made payments on the note until September 24, 1987, at which time the unpaid balance was $3,110.01. No payments were made after that date. 2. Elmer E. Conrad borrowed $1,751.04 from DAFCU on September 5, 1986 and executed a note to secure the debt. He made payments on the note until June 4, 1987, at which time the unpaid balance was $1,252.54. No payments were made after that date. 3. Elmer E. Conrad died December 22, 1993, and Letters of Administration C.T.A. were granted to Michael Conrad. 4. Members 1st Federal Credit Union filed a Complaint to No. 95-110 Civil Term to collect the unpaid balance of the two loans on January 10, 1995. An Answer was filed by the estate raising the defense of statute of limitations. 5. The Account filed by the Administrator acknowledges the decedent owed DAFCU the amount claimed in the Complaint ($8,418.86 as of February 3, 1995), but denied payment.3 The parties have added the following additional stipulation: If the Court determines the said statute applies, the claim of Members 1st Federal Credit Union is not barred by the statute of limitations and it is a creditor of the estate entitled to share pro-rata with other non- preferred creditors. If the Court determines the statute does not apply, the claim is barred by the statute of limitations and the 3 Stipulated Facts in Re: Exceptions to Administrator's Account. NO. 94-0154 ORPHANS' COURT Credit Union is not a creditor of the estate.4 The notes at issue in the present case are attached to this Opinion as Exhibits A and B. DISCUSSION Under Section 5525 of the Judicial Code, as amended in 1982, it is provided that the following actions and proceedings, inter alia, must be commenced within four years: (7) An action upon a negotiable or nonnegotiable bond, note or other similar instrument in writing .... (8) An action upon a contract, obligation or liability founded upon a writing not specified in paragraph (7), under seal or otherwise, except an action subject to another limitation specified in this subchapter,s However, under Section 5529(b) of the Code, as amended in the same enactment in 1982, it is also provided as follows: Notwithstanding section 5525(7) [of the Code] (relating to four year limitation), an action upon an instrument in writing under seal must be commenced within 20 years.6 This provision was to be effective until June 27, 1998.7 Different provisions of the same statute should, of course, be recOnciled where possible to give effect to all provisions. See ~ Id. s Act of December 20, 1982, P.L. 1409, ~201, 42 Pa. C.S. §5525(7), (8) (1994 Supp.). ~ Id., §5529(b)(1). 7 Id., ~5529(b)(2). 3 NO. 94-0154 ORPHANS' COURT generally Anderson v. Anderson, 375 Pa. Super. 341, 544 A.2d 501 (1988). In addition, it is a rule of statutory construction that the particular controls the general.8 In the present case, the notes executed by the decedent, being "bond[s], note[s], or other similar instrument[s] in writing" and being under seal, appear to the Court to be encompassed by Section 5529(b) (20-year statute) of the Judicial Code and to be expressly excluded from the operation of Section 5525(7) (4-year statute). Section 5525(8) (4-year statute) is a more general provision than Section 5529(b), and less arguably applicable to such instruments. This conclusion appears to be consistent with the Pennsylvania Superior Court's recent decision in Beneficial Consumer Discount v. Dailey, 434 Pa. Super. 636, 644 A.2d 789 (1994). In Beneficial, the Court held that the 20-year statute of limitations contained in Section 5529(b) of the Judicial Code governed a loan agreement signed by the borrowers in 1985 on a form containing the word "SEAL" pre-printed to the right of their names. In so holding, the Court was aware of the case primarily relied upon by the estate herein, but did not utilize it for the proposition advanced by the 8 Act of December 6, 1972, P.L. 1339, ~3, 1 Pa. C.S. ~1933 (1994 Supp.). 4 NO. 94-0154 ORPHANS' COURT' estate.9 For these reasons, the Court holds that the promissory notes at issue herein are governed by a 20-year statute of limitations, and that the creditor's objections to the first and final account of the administrator c.t.a, must therefore be-sustained. DECREE NISI AND NOW, this ~ day of April, 1995, after careful consideration of the objections of Members lst Federal Credit Union to the First and Final Account filed by the Administrator c.t.a herein, and for the reasons stated in the accompanying Opinion, the objections are SUSTAINED. 9 This case is Klein v. Reid, 282 Pa. Super. 332, 422 A.2d 1143 (1980). In Klein, the Court held that a six-year statute of limitations applicable at that time to unsealed instruments did not govern a 1970 note containing the pre-printed word "seal" next to the maker's signature. In dictum in a footnote, the Court expressed its belief that a certain 1976 amendment to the Judicial Code providing for a six-year limitation on "actions upon a contract, obligation or liability founded upon a bond, note or other instrument in writing" effectively subjected "actions o[n] sealed and unsealed instruments ... to the same six-year limitation.,' Klein v. Reid, 282 Pa. Super. 332, 334 n.2, 422 A.2d 1143, 1144 n.2 (1980). The 1976 language~referred to in Klein has been replaced as of 1982 by the present provisions of Section 5525 of the Judicial Code quoted in the text. These provisions, and those of present Section 5529(b), also enacted in 1982, are applicable to the 1986 notes at issue. NO. 94-01~54 ORPHANS' COURT THIS DECREE NISI shall become a final decree unless a timely motion for post-trial relief is filed pursuant to Pennsylvania Rule of Civil Procedure 227.1. BY THE COURT, s/ J. Wesley Oler, Jr. J. Wesley Oler, Jr., J. Diane G. Radcliff, Esq. 3448 Trindle Road Camp Hill, PA 17011 Attorney for the Estate John M. Eakin, Esq. Main and Market Streets Mechanicsburg, PA 17055 Attorney for the Objectant :re [ CONARD, ELMER E, MECHANICSBURS, PA. 17055 4811006 12/19/~9 CLOSED-ENO DISCLOSURE, LOAN AND SECURITY AGREEMENTS $ 776.35 '- · $ 4667:49 $ 5445.84 You~ ~ym~o~ sch~du~ will b~: ' ~3 ~6.91' monthly beginning 05/01/86..~1 I ~26.91 final payment due 04/01/88 ~curily: Y~ e~e ~ivlnl a secu~ilv Inlmer~ In: ~ ~he leods o~ prop~ty being pmch~ed. ~ OUm.' de~lbe Signature ~his Cr~t Union Does Not assess any Late Cha~qes. I ~ep~nl: If y~ ~ay o1~ e~ly. ~ou will ~et h~ ~o pay a penal~y. ' ' ~ See ~ou~ c~w~l documenls lot an1 ~dition~ inf~malion e~ul nenpeyment, dd~ll. ~V mquked repayment in lull bef~e and p~epeyme~l refund~ end plnellleL ITEMIZATION OF AMOUNT FINANCED OF S 4667. 49 ~ Amounl Paid lo others~°n you~ belall (Oe~ctibeJ S ~000.00 S ~19.~1 S 147.58 s n/a s n/a s n/a n/a Months n/a APPLICATION FOR GROUP CREDIT INSURANCE I do N~t ~Jt Ols~llitrl Total ~t is Oi.bllfty l~a~t T~s is 24 ~th~ initial amunt Jt 6~44~,~ ~hly Oiubllity ~fft is a~tl~ly I0 repay my obl~al~n.' I ~omlse nol Io su~ll lal~ ot 6. Sh~d y6~'leel al any lime i~l'~he EXHIBIT A DEFENSE ALTTIV1TIES FCU 10 ~.' 0~/05/86 UNRAD, ELMER E. 25 W. GREEN ST. MECH., PA 17055 4811006 CLOSED-END DISCLOSURE. LOAN AND SECURITY AGREEMEN IS ,, ....... ,o,~,~,..,.,,~,~.I ...... ,,,,..~,,~,,~o~,~. ~..~,o~. .... ~ ,-,...,.~.~, Your pa~enl ~h~u~ ~fl ~: I 145.92 final payment due 09/15/67 Sscmi;~: Y~ mo ~¥9 a s~ff INstesl i~ ~ Tim ~ et ~ ~ ~s~. ~ ~hs~, ds~t~s hi C~edit Union Does Not assess any Late [ / I~s~e M~ths: / Prepayment: If ~u pay off eady, ~ ~fl ~ ha~ Io ~y a ~nalt~. S~ ~uf ~lfacl d~uments ~ any a~iti~ ~l~ti~ a~ ~paymen{, default, ~y fequlr~ r~ ~ fu~ ~f~e the ~u~ date, ar~ pfe~ymenl lefu~s a~ ~l;les. __ 1GO0. O0 $ n/a $ 37.~0 $ n/a $ n/a $ ' Hole: Give delails of other security offe~ed. _ ~460~-G 1~0 Months $~0000. O0 APPLICATION FOR GROUP CREDIT INSURANCE i do ,ant Cr~it 91sabllityt Total ~st is t37.30 Disability I~ur~1 lam is l~ ~ths. Initial ~unt is t~731.~ ~thly Disability ~mfit is E~UTRTT B _1~ !N.IHESE AGREEMENIS. THE WORDS "r'. "ME". "MY" AND "MINE" ~ Ihe secured pro~. ql¥ p;oceed ',.~.:' ~o "~o~.~" ~.. E c.~o. ~.,o.,, " .:'.',,.~l~'r · .,' I I~'.f 'i ~:~PefI~'I;Z liJ~l;:~ .~1 a~ll~ly'lo lepav my obllgalto.' I 'plomtse not to submll'lel~ ~ 6. ShoUld y~'leel ii a~ty time Ihl~he lecullly presented