Appeal from order of Court of Common Pleas of Clearfield County, Oct. T., 1970, No. 477, in case of E. Eugene Monnoyer v. James A. Gaffney.
Anthony S. Guido, for appellant.
Robert B. Maine, with him Maine and Fennell, for appellee.
Wright, P. J., Watkins, Jacobs, Hoffman, Spaulding, Cercone, and Packel, JJ. Opinion by Watkins, J. Dissenting Opinion by Packel, J. Cercone, J., joins in this dissent.
[ 222 Pa. Super. Page 170]
This is an appeal from the order of the Court of Common Pleas of Clearfield County refusing to open judgment entered by confession in favor of E. Eugene Monnoyer, plaintiff-appellee, and against James A. Gaffney, the defendant-appellant.
This action arose out of an agreement between the parties whereby the plaintiff sold and the defendant purchased 308.3 shares of common stock of Community Consumer Discount Company of Dubois, Pennsylvania, for the purchase price of $101,000.00, with $51,000.00 as a down payment and the balance to be paid within twenty years with interest at 4% per annum in monthly installments on the 10th day of each and every month.
Pursuant to the agreement, the parties entered into a judgment note with regard to the balance of the purchase price, which judgment note contained the usual clause of confession with warrant of attorney together with acceleration of payments in the event of the default of any payment.
The parties further entered into an Hypothecation Agreement for the payment of the balance of the purchase price whereby the payments were to be made to the DuBois Deposit National Bank, which provided that in the event of default, the Bank could if it desired seal the deposited collateral security and make application of profits in accordance with the agreement. The Hypothecation Agreement reads as follows:
"To: DuBois Deposit National Bank
"The undersigned hereby hypothecates, pledges and delivers to you stock certificates for 308.3 shares of the capital stock of Community Consumer Discount Company,
[ 222 Pa. Super. Page 171]
a Pennsylvania corporation having its principal office in the City of Dubois, Pennsylvania, which shares belong to the undersigned and shall be collateral to secure the obligation of the undersigned to E. Eugene Monmoyer in the principal amount of Fifty-one Thousand ($51,000.00) Dollars, evidenced by the note of undersigned bearing even date herewith, payable to the order of the said E. Eugene Monmoyer within twenty (20) years from said date in equal successive monthly principal payments, with interest at the rate of 4 1/4% per annum, on the 10th day of each month.
The undersigned stipulates that the said securities shall be subject to disposition by you in accordance with the terms and conditions of the agreement between the undersigned and E. Eugene Monmoyer dated May 2, 1961, under the terms of which the said 308.3 shares of the Community Consumer Discount Company capital stock were purchased by the undersigned. The undersigned further authorizes you, in the event of default in the payment of the said note or any installment thereof, to sell the said collateral or any part thereof at public or private sale and assign, transfer and deliver the whole or any part of said collateral to the purchaser freed and discharged of any equity or redemption. After deducting all legal or other costs and expenses of collection, sale and delivery, you shall apply the residue of the proceeds of such sale or sales to pay the obligation evidenced by said note, returning the surplus, if any, to the undersigned, but if there is a deficiency the undersigned shall remain liable for the amount unpaid."
The Judgment Note in question dated May, 1961, read:
"For Value Received, I, the undersigned, promise to pay to the order of E. Eugene Monmoyer, of the City of DuBois, Clearfield County, Pennsylvania, the sum of ...