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decided: June 14, 1973.


Appeal from order of Court of Common Pleas of York County, Oct. T., 1971, No. 44, in case of Transnational Consumer Discount Company v. Maurice E. Kefauver, III and Julie A. Kefauver.


Alan N. Linder, with him J. Richard Gray, Eugene Zenobi, and Donald B. Swope, for appellants.

Donald H. Yost, with him Wogan, Elsesser & Yost, for appellee.

Wright, P. J., Watkins, Jacobs, Hoffman, Spaulding, Cercone, and Spaeth, JJ. Opinion by Spaeth, J.

Author: Spaeth

[ 224 Pa. Super. Page 476]

This is an appeal from an order denying a petition to stay execution upon household goods up to $300 in value.

Appellants signed a judgment note and a security agreement containing the standard clause that the signers "waive all relief from all appraisement and exemption laws of any State now in force or hereafter to be passed". Upon appellants' failure to make payment as required by the note, appellee sued upon the note, obtained a judgment by default, and issued execution. When the sheriff levied upon household goods covered by the security agreement, appellants claimed the exemption granted by Section 1 of the Act of April 9, 1849, P. L. 533, 12 P.S. § 2161, which provides: "In lieu of the property now exempt by law from levy and sale on execution, issued upon any judgment obtained upon contract and distress for rent, property to the value of three hundred dollars, exclusive of all wearing apparel of the defendant and his family, and all bibles and school books in use in the family (which shall remain exempted as heretofore), and no more, owned by or in possession of any debtor, shall be exempt from levy and sale on execution or by distress for rent."

Because of the waiver clause in the security agreement, however, the sheriff rejected appellants' claim, and the lower court, after hearing, denied appellants' petition to stay execution. The court recognized that the waiver clause did not specifically refer to the Act of 1849. Moreover, the court evidently accepted appellants' testimony that they did not know they had an exemption to waive. Nevertheless, the court said: "The waiver is here stated on the face of the note and in standard type and was not buried in fine print . . . . It is clear from the deposition of the parties that defendants had an ample opportunity to read the loan documents and

[ 224 Pa. Super. Page 477]

    that the plaintiff was not guilty of any misconduct or misrepresentation. Defendants were in general aware of the terms of their loan and recognized that their furniture could be taken in the event of their default. However, defendants did testify that they were not aware that they had an exemption, and obviously were not aware that they were waiving the same. In Adams v. Bachert, 83 Pa. 524 (1877), it was held that failure to understand the terms of a waiver in a written instrument would not void its effect in the absence of fraud, or palpable mistake or misapprehension. The facts in Adams are almost identical to the case at bar and we are bound to hold that the waiver was equally valid applying the rule of that case . . . ."

In Adams the lower court granted the debtor's motion to open judgment. Two issues had been tried on the motion: "1. 'Whether or not the defendant confessed the above judgment'; 2. 'Whether or not the defendant waived the benefit of the law exempting property from execution.'" Id. at 525. On the issue of waiver the trial judge had charged the jury as follows: "This [$300 exemption] is a personal privilege given to the defendant under the statute . . . no man can be held to waive a privilege unless he is informed of that fact. He cannot be held, in law, to have waived the three hundred dollar exemption law, unless knowledge was brought to him at the time he signed the note; and the question then for your determination is: did the defendant know, at the time he signed the note, that it was an exemption note, or, in other words, that he had waived the privilege which the statute conferred upon him . . . ." Id. at 525. The Supreme Court reversed, holding that "[w]hen the plaintiffs proved the execution of obligation, they made out their case -- a case that could only be impeached by proof that the signature thereto had been obtained by fraud, or through some

[ 224 Pa. Super. Page 478]

    palpable mistake or misapprehension of the parties. What if Bachert did not know that the paper he executed contained an agreement to waive exemption? He did not know because he did not inquire . . . . There was no fault on the part of the plaintiffs . . . . Under such circumstances . ...

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