No. 571 April Term, 1977, Appeal from Order Entered February 17, 1977, of the Court of Common Pleas of Washington County, Pennsylvania, No. 7175 in Equity. (Civil Division)
John M. Feeney and June S. Schulberg, Pittsburgh, for appellant.
Gordon F. Harrington, and Greenlee, Richman, Derrico & Posa, Washington, for appellee.
Watkins, President Judge, and Jacobs, Hoffman, Cercone, Price, Van der Voort and Spaeth, JJ. Watkins, former President Judge, did not participate in the consideration or decision of this case.
[ 257 Pa. Super. Page 136]
The instant appeal arises from the lower court's refusal to order the opening of a default judgment entered for want of an answer to plaintiff-appellee's complaint in equity. Since we find that the court below abused its discretion, we will reverse the court's order denying the motion to open and remand for further proceedings.
The relevant facts of the instant controversy are as follows: On July 9, 1976 Mr. James Ashton, plaintiff-appellee, caused a complaint in equity to be filed in Washington County seeking to set aside his conveyance of certain real property by deed to his wife, Caroline Ashton. The property was a farm in Washington County which the parties had held by the entireties. In addition, Mr. Ashton requested that the court enjoin Mrs. Ashton from conveying or encumbering the real property and order her to account for certain personal property which she had sold or was in the process of selling. Upon service of the complaint on July 19, 1976, the complaint having been filed on Mr. Ashton's behalf by Attorney Lawrence Zewe, Mrs. Ashton promptly retained Mrs. June Schulberg as counsel. Attorney Zewe had previously represented both Mr. and Mrs. Ashton in legal affairs relating to real estate and taxation; hence, by letter dated July 22, 1976, Attorney Schulberg, referring to a previous telephone conversation with Attorney Zewe, requested that he withdraw as counsel for plaintiff because of his potential, if not manifest, conflict of interest. Thereafter, on August 6, 1976 Attorney Schulberg entered her appearance for Mrs. Ashton and so notified Attorney Zewe of that fact. By
[ 257 Pa. Super. Page 137]
letter dated August 31, 1976, Mr. Zewe thanked Mrs. Schulberg for notifying him of her appearance, indicated that another lawyer, Mr. Krosnoff, had also filed an appearance on Mr. Ashton's behalf and stated that he, Attorney Zewe, would soon "formally" withdraw his appearance. Following this correspondence there were no conversations or correspondence of record between counsel for the parties. Although Mrs. Schulberg did not file an answer to the complaint, neither did Attorney Zewe formally withdraw his appearance as promised. Mrs. Schulberg did not discuss the case with Mr. Krosnoff because, she averred, attempts to locate him were fruitless; his office was not listed in the Washington County telephone directory.
As indicated, the matter lay dormant for several months until November 12, 1976, when Mr. Ashton's third lawyer, Gordon Harrington, entered an appearance on Mr. Ashton's behalf and simultaneously filed a praecipe to enter judgment by default for plaintiff. At no time did any of the counsel for plaintiff indicate an intention to take a judgment for want of an answer, nor did Attorney Zewe formally withdraw his appearance as promised. After returning from a professional convention in Bermuda, Mrs. Schulberg learned of the default judgment and promptly filed a motion to strike or open the judgment. In the petition Mrs. Schulberg averred the foregoing facts to excuse her delay in filing an answer to the complaint, and, in defense to the equity action on the merits, alleged that Mrs. Ashton held a valid deed to the property which had been conveyed to her for a valuable consideration; to wit, a series of loans extended to Mr. Ashton by Mrs. Ashton.
Following a hearing on December 20, 1976 wherein counsel argued their respective views regarding the merits of the motion to open, and submitted briefs in support of their positions, the court denied the motion. In its opinion the court set forth a variety of reasons for its refusal to strike or open the judgment. First, the court stated that Attorney Schulberg failed to avail herself of the opportunity to file depositions or interrogatories in support of her motion to
[ 257 Pa. Super. Page 138]
strike or open. Hence, pursuant to Pa.R.Civ.P., Rule 209, facts which plaintiff disputed in the answer to the motion to strike or open were deemed admitted by defendant, Mrs. Ashton. However, the court limited the application of Rule 209 to the motion to strike as, indeed, the salient facts with respect to the motion to open were either supported by exhibits or admitted by plaintiff. Attorney Schulberg had attached as an exhibit Attorney Zewe's letter stating his intention to withdraw his appearance, and the fact that his appearance was never withdrawn was a matter of record. Mrs. Schulberg's prompt entrance of her appearance on Mrs. Ashton's behalf was also a matter of record. And, finally, plaintiff admitted in his answer that at no time was Mrs. Schulberg notified of plaintiff's intention to take a default judgment. Nevertheless, with regard to the motion to open the lower court found that, although it had been timely filed, Mrs. Schulberg had neither reasonably excused her delay in filing an answer nor adequately set forth a meritorious defense. ...