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decided: January 27, 1975.



R. Stanton Wettick, Jr., Peter D. Jacobson, Neighborhood Legal Services, Assn., Pittsburgh, for appellants.

James R. Fitzgerald, Reed J. Davis, Donald S. Mazzotta, Davis & Mazzotta, Norman Paul Wolken, Pittsburgh, for appellees.

Eagen, O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Jones, C. J., took no part in the consideration or decision of this case.

Author: Nix

[ 460 Pa. Page 130]


Robert D. Mayhugh and his wife, Sarah, instituted an action in equity on their behalf and on behalf of all others similarly situated seeking to enjoin the Prothonotary and Sheriff of Allegheny County from continuing certain practices regarding the waiver of exemption rights granted to a debtor under the Act of April 9, 1849, P.L. 533, § 1, 12 P.S. § 2161.*fn1 Subsequently Mellon National Bank and Trust Company, Western Pennsylvania National Bank, Associates Financial Services Company, Inc., Signal Finance Corporation and Plaza Rubber Corporation were permitted to intervene as defendants. Albert J. Niedzielski, Peter P. Wojckowski, appellants herein, in their individual capacity and as representatives of a class of persons similarly situated, and Maggie Graves were permitted to intervene as plaintiffs. The

[ 460 Pa. Page 131]

    decree nisi, after dismissal of the exceptions filed thereto, was made final. The Chancellor granted a permanent injunction, which restrained the Prothonotary and Sheriff of Allegheny County from issuing and executing writs of execution containing the notation that the rights afforded by the Act of April 9, 1849, supra, had been waived where the judgment debtor had not been apprised by the allegation in the complaint that such rights had been waived.

The debtors in the action below fell within two separate categories. The first group consisted of those persons who had judgments entered against them pursuant to complaints filed with the Prothonotary of the Court of Common Pleas or with the Justices of the Peace which did not contain an averment of waiver of exemption benefits. The second group were those debtors who had judgments entered against them pursuant to complaints that did aver the fact of waiver of exemption rights. The court below, after hearing, granted relief to the group where there had been no averment of waiver and denied injunctive relief in those cases where the complaints did contain an averment of waiver. The present appellants are members of the latter group.

The court below found that the exemption provided under the Act of April 9, 1849, supra, may be waived but granted relief to those debtors where there had been no averment in the complaint on the theory that such a procedure was not in compliance with due process. Appellants contend that they too are entitled to relief premising their claim on the theory that the Act of April 9, 1849, does not permit the protection provided to be waived. We agree that a debtor may not, either expressly or by implication, waive the right of exemption as provided for in the Act of April 9, 1849, and therefore sustain the appeal of the instant appellants.*fn2

[ 460 Pa. Page 132]

In Pennsylvania, it was held in Case v. Dunmore, 23 Pa. 93 (1854) and thereafter, by its progeny,*fn3 that such an exemption is a personal privilege, which the debtor may waive at pleasure. In Case v. Dunmore, supra, this Court reasoned:

"Notwithstanding the benevolent provisions of the statute in favor of unfortunate and thoughtless debtors, it was far from the intention of the legislature to deprive the free citizens of the state of the right, upon due deliberation, to make their own contracts in their own way, in regard to securing the payment of debts honestly due. Creditors are still recognized as having some rights; and it was not the intention of the legislature to destroy them by impairing the obligation of contracts." Id. at 94-95.

In Bowman v. Smiley, 31 Pa. 225 (1858) we stated:

"Notwithstanding the doubts which have sometimes been expressed, it is now generally conceded that the statutory privilege of the exemption of a portion of his property from levy and sale, under execution, is one which a debtor may waive. When made at the time the debt is created, the waiver is based upon the same consideration as that upon which rests the liability to pay, and is therefore irrevocable. Such a waiver is a contract, that, so far as regards the judgment-creditor, in whose favor it is made, the debt shall be collectable in the same manner as if the Act of April 9th 1849 had never been passed. Against an execution issued upon such a judgment, it is conceded, that the debtor has no right to retain any portion of the property which, without the act, would be liable to levy and

[ 460 Pa. Page 133]

    sale; nor has he any more right to an appraisement." (Emphasis added). Id. at 226.

A review of the historical setting in which this legislation was enacted compels us to concede that these earlier decisions were erroneous in reaching the conclusion that the protection of this Act was able to be waived.

At common law, through reasons of feudal policy, all of a debtor's property was liable to execution for the payment of his debts, and his person was subject to imprisonment. See Pendleton, Debtors' Exemption in Pennsylvania, 17-18, 27-37 (1886); Smyth, The Law of Homestead and Exemptions, 49-56 (1875); Thompson, A Treatise on Homestead and Exemption Laws, 4-5 (1878); Graubart, "Waiver of Debtors' Exemptions in Pennsylvania", 44 Dick.L.Rev. 130 (1943). This view prevailed in the United States until the turn of the nineteenth century when, either by state constitutions or legislative acts, or by both, various pieces of legislation were passed for the benefit of the debtor and his family exempting from levy and sale a debtor's lands, tenements and portions of his personal property. In Pennsylvania, this more humane tendency in legislation manifested itself early in the nineteenth century*fn4 and culminated in

[ 460 Pa. Page 134]

    the passage of the Act of July 12, 1842, abolishing imprisonment for debt, and the exemption Act of April 9, 1849. The true spirit of this legislation was accurately reflected in this Court's decision in Freeman v. Smith, 30 Pa. 264 (1858):

"The Act of Assembly of 1849 was kind and beneficent legislation, in favour of the poor and distressed. It put it out of the power of the creditor, often grasping and avaricious, to strip a debtor and his family of their only means of subsistence. It inaugurated a new era; for the first time, the law seemed to treat inability to pay, not as a crime, but as a possible misfortune, than the ancient frown of condemnation upon inability to pay." Freeman v. Smith, Id. at 266.

The legislature was obviously concerned with the situation of the debtor and not, as suggested in Case v. Dunmore, supra and Bowman v. Smiley, supra, with the protection of the creditor. This series of enactments reflected a realization that justice to a creditor may well result in oppression to a debtor. Further, it represented an application that stripping the poor and distressed of all of their wordly possessions in an effort to satisfy an obligation, albeit just, was not in the public interest where the result was to create a condition rendering the debtor and his dependents public charges. Read in conjunction with the Act of 1842, it is clear that there was an appreciation that freedom from imprisonment would be meaningless if the debtor could nevertheless, be stripped of all belongings and deprived of all means of regaining a modicum of economic stability. The policy and object of the legislation in conferring the exemption benefits was to afford the debtor, and his family, the prime necessities of life, and to furnish the insolvent a nucleus with which to begin life anew. It would be absurd to assume that a legislature would intend to permit such a basic and obviously strong policy to be completely frustrated by the mere alteration of the agreement. It is

[ 460 Pa. Page 135]

    a fundamental rule of statutory construction that the legislature would not be assumed to have intended a result which is unreasonable and absurd. 1 Pa. S. § 1922.

"The statutes which allow a debtor . . . to retain, as against the legal remedies of his creditors, certain articles of prime necessity to a limited amount, are based upon views of policy and humanity, which would be frustrated if an agreement like that contained in these notes, entered into a connection with the principal contract, could be sustained. A few words contained in any note or obligation would operate to change the law between those parties, and so far disappoint the intentions of the Legislature. If effect shall be given to such provisions, it is likely that they will be generally inserted in obligations for small demands, and in that way the policy of the law will be completely overthrown." Kneettle v. Newcomb, 22 N.Y. 249, 250 (1860).

Unfortunately, the prognosis of this New York Court has proven to be a reality from our experience in this Commonwealth. We must reject the argument that allowing waivers of this fundamental right is justified because it is a relinquishment of a right voluntarily accomplished. It is clear that the spirit of this law was to protect the debtor against his improvidence and bad judgment. The legislative intention to protect the debtor against his own thoughtlessness and extravagance is further demonstrated by the succession of amendments to the initial Act providing for an exemption. Each successive change in the law increased the protection provided which further reflects the strong concern for the welfare of the debtor. See, Pendleton, Debtors' Exemption in Pennsylvania, 32-33 (1886).

We do not agree that the strictures of the doctrine of stare decisis should prevent us from rectifying

[ 460 Pa. Page 136]

    an error that has long been recognized.*fn5 The doctrine of stare decisis was never intended to be used as a principle to perpetuate erroneous principles of law. While we fully ascribe to Lord Coke's evaluation of the importance of certainty in the law, this end obviously cannot outweigh, the necessity of maintaining the purity of the law. The court's function is to interpret legislative enactments and not to promulgate them. Where, as here, by our decisions in Case, Bowman and the other decisions that followed, the Court distorted the clear intention of the legislative enactment and by that erroneous interpretation permitted the policy of that legislation to be effectively frustrated, we now have no alternative but to rectify our earlier pronouncements and may not blindly adhere to the past rulings out of a deference to antiquity.

The wisdom of the policy behind legislative enactments is generally not the concern of the court. Ferguson v. Skrupa, 372 U.S. 726, 83 S.Ct. 1028, 10 L.Ed.2d

[ 460 Pa. Page 13793]

(1963); Olsen v. Nebraska ex rel. Western Ref. & Bond Ass'n., 313 U.S. 236, 61 S.Ct. 862, 84 L.Ed. 1305 (1941); Nebbia v. New York, 291 U.S. 502, 54 S.Ct. 505, 78 L.Ed. 940 (1934). However, we would be remiss if we failed to observe the absence of any reasonable basis for accepting the view that these rights may be waived. The court in Case was concerned with "a poor man . . . unjustly kept out of money due to him" Id 23 Pa. at 95. While this may have had some validity during the middle 19th century it is clearly inapplicable to the sophisticated lending institutions of this day. Unlike in former years where the debtor and creditor may have been on a relatively equal basis, such is clearly not the case in our current society nor can it be seriously argued that today's credit industry would be critically jeopardized or curtailed because the creditor was required in all cases to respect the exemptions. The fact that the majority of the states of this nation have embraced the principle that this exemption cannot be waived*fn6 refutes any argument that such a position would adversely affect the financial sector.

[ 460 Pa. Page 138]

We therefore hold that the provisions of the Act of April 9, 1849, supra, may not be waived either expressly or by implication.*fn7

The decree of the Court insofar as it is inconsistent with this opinion is reversed and vacated and the cause remanded for further proceedings consistent herewith.

Each party to bear own Costs.

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