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GREENWOOD v. KADOICH (03/29/76)

decided: March 29, 1976.

GREENWOOD
v.
KADOICH, APPELLANT



Appeal from order of Court of Common Pleas of Lehigh County, Sept. T., 1973, No. 1145, in case of Elizabeth J. Greenwood, t/a House of Charm Schools v. Ruth K. Kadoich, a/k/a Ruth K. Ritz.

COUNSEL

William G. Ross, with him Sigmon, Littner & Ross, for appellant.

Donald L. VanGilder, with him Henry S. Perkin, Frederick N. Nabhan, and Nabhan & Nabhan, for appellee.

Watkins, P. J., Jacobs, Hoffman, Cercone, Price, Van der Voort, and Spaeth, JJ. Opinion by Jacobs, J.

Author: Jacobs

[ 239 Pa. Super. Page 374]

This is an appeal from an order of the Court of Common Pleas of Lehigh County denying defendant-appellant's petition to open a judgment entered by confession. We reverse the order of the court below.

Appellant Ruth K. Kadoich, a/k/a Ruth K. Ritz, defendant below, entered into a written agreement on April 8, 1970 with appellee Elizabeth J. Greenwood, t/a House of Charm Schools. The agreement provided authorization for appellant to operate appellee's modeling and finishing school. Appellant thereafter operated the school, until September, 1973. A judgment note in the amount of $10,000.00 was executed as a part of the transaction providing for transfer of the school, and appellant defaulted thereon. On November 7, 1973, a confessed judgment was entered on the note. On December 24, 1973, appellant petitioned to open the confessed judgment, alleging that the transaction upon which the note was based was permeated by fraud and misrepresentation.

In order to open a confessed judgment, the judgment debtor must act promptly and produce evidence in support of a meritorious defense. Wenger v. Ziegler, 424 Pa. 268, 226 A.2d 653 (1967); Wolgin v. Mickman, 233 Pa. Superior Ct. 218, 335 A.2d 824 (1975); Ritchey v. Mars, 227 Pa. Superior Ct. 33, 324 A.2d 513 (1974); Cheltenham Nat'l. Bank v. Snelling, 230 Pa. Superior Ct. 498, 326

[ 239 Pa. Super. Page 375]

A.2d 557, cert. denied, 421 U.S. 965 (1974). See also, Joseph A. Puleo & Sons, Inc. v. Rossi, 234 Pa. Superior Ct. 612, 340 A.2d 557 (1975). Prior to the adoption of Pa.R.C.P. 2959(e) the evidence which the judgment debtor had to produce in support of his meritorious defense was such evidence as would persuade the court that, upon submission to a jury, a verdict in his favor could be upheld. See, Wolgin v. Mickman, supra at 222 n.3, 335 A.2d at 826 n.3. However, Rule 2959(e), effective December 1, 1973, provides that a judgment by confession shall now be opened if a petitioner seeking relief therefrom produces evidence which in a jury trial would require the issues to be submitted to a jury. "Thus, a court can no longer weigh the evidence in support of the defense, but must only determine whether there is sufficient evidence to allow the issue to go to the jury [cit. omitted]." Wolgin v. Mickman, supra at 222, 335 A.2d at 826. Otherwise stated, the judgment should be opened where the evidence produced would be sufficient to "'prevent a directed verdict against [her]' D.H. Overmyer Co., Inc. v. Frick Co., 405 U.S. 174, 190, 92 S. Ct. 775, 784 (1972) (DOUGLAS, J., Concurring). See also Ritchey v. Mars, supra, at 36, n.4, 324 A.2d at 515, n.4." Joseph A. Puleo & Sons, Inc. v. Rossi, supra at 616, 340 A.2d at 558.

[ 239 Pa. Super. Page 376]

The defense advanced here was fraud. Whether fraud has been committed is a question of fact which is always a jury question. See, Highmont Music Corp. v. J.M. Hoffman Co., 397 Pa. 345, 155 A.2d 363 (1959); Davis v. Carbon County, 369 Pa. 322, 85 A.2d 862 (1952); Berardini v. Kay, 326 Pa. 481, 192 A. 882 (1937); Edelstein v. Carole House Apartments, Inc., 220 Pa. Superior Ct. 298, 286 A.2d 658, allocatur refused, 220 Pa. Superior Ct. xxxviii (1971). However, although the question of the existence of fraud is a jury question, evidence of fraud must be clear and convincing, Bucks County Bank & Trust Co. v. DeGroot, 226 Pa. Superior Ct. 419, 423, 313 A.2d 357 (1973); Edelstein v. Carole Page 376} House Apartments, Inc., supra; Gerfin v. Colonial Smelting & Refining Co., Inc., 374 Pa. 66, 97 A.2d 71 (1953); and whether the evidence of fraud meets the required standard which justifies its submission to the jury is always a question of law for the court. Gerfin v. Colonial Smelting & Refining Co., Inc., supra; see, Edelstein v. Carole House Apartments, Inc., supra; Berardini v. Kay, supra.

The issue presented here is thus whether appellant's evidence of fraud and misrepresentation was sufficiently clear and convincing, as a matter of law, to prevent a directed verdict against her. Since the standard of sufficiency here is that employed on consideration of a directed verdict, the facts must be viewed in the light most favorable to appellant and we must accept as true all evidence and proper inferences therefrom supporting her defense of fraud and must reject the adverse allegations of appellee. See, Austin v. Harnish, 227 Pa. Superior Ct. 199, 323 A.2d 871 (1974); Cox v. Equitable Gas ...


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