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INDUSTRIAL VALLEY BANK AND TRUST COMPANY v. LAWRENCE VOLUCK ASSOCIATES (04/03/81)

filed: April 3, 1981.

INDUSTRIAL VALLEY BANK AND TRUST COMPANY, APPELLANT,
v.
LAWRENCE VOLUCK ASSOCIATES, INC. INDUSTRIAL VALLEY BANK AND TRUST COMPANY, V. LAWRENCE VOLUCK AND CAROL H. VOLUCK, APPELLANTS



Appeal from Order of the Court of Common Pleas, Civil Division, of Philadelphia County at No. 2494 July Term, 1978. Appeal from Order of the Court of Common Pleas, Civil Division, of Montgomery County at No. 78-11855.

COUNSEL

Kenneth F. Carobus, Philadelphia, for Industrial Valley, appellant (at No. 218) and for appellee (at No. 813).

Niels Korup, Philadelphia, for Lawrence Voluck, appellee (at No. 218) and for appellant (at No. 813).

Spaeth, Cavanaugh and O'Kicki, JJ.*fn*

Author: Cavanaugh

[ 285 Pa. Super. Page 502]

The dispute in this case involves two judgments taken by confession. One was entered in Montgomery County against Lawrence Voluck and Carol Voluck. The second judgment was entered in Philadelphia County against Lawrence Voluck Associates, Inc. On August 29, 1977, Lawrence Voluck Associates, Inc. (hereinafter LVA) signed a note in the amount of $114,000 to Industrial Valley Bank (hereinafter IVB). On the same day Lawrence and Carol Voluck (hereinafter the Volucks) executed what was titled a Guaranty Agreement as security for LVA's indebtedness to IVB. Both the note and the Guaranty Agreement contained warrants of attorney to confess judgment.

On July 14, 1978, IVB filed a Confession of Judgment against the Volucks in Montgomery County where they resided. On July 17, 1978, IVB filed a Confession of Judgment against LVA in Philadelphia County where the Corporation was doing business. At that time the alleged amount of the principal due on the note was approximately $68,000.

Subsequently, the Volucks and LVA filed petitions in the respective courts to open the judgments. The Court of Common Pleas of Philadelphia County found that LVA had a meritorious defense and ordered the judgment opened. IVB appeals from this order. The Court of Common Pleas of Montgomery County denied the petition to open. From this order the Volucks have taken an appeal.

The appeals of IVB, No. 218 October Term, 1979 and of the Volucks, No. 813 October Term, 1978 have been consolidated. After careful consideration we reverse the order of the Court of Common Pleas of Philadelphia County, and affirm the order of the Court of Common Pleas of Montgomery County.

One who petitions to open a confessed judgment must act promptly and offer a meritorious defense. Wenger v. Ziegler, 424 Pa. 268, 226 A.2d 653 (1967); Foerst v. Rotkis, 244 Pa. Super. 447, 368 A.2d 805 (1976); Ritchey v. Mars, 227 Pa. Super. 33, 324 A.2d 513 (1974). Because it is not alleged

[ 285 Pa. Super. Page 503]

    that LVA or the Volucks failed to act promptly, the only question before us is whether the lower court abused its discretion in refusing to open judgment for want of a meritorious defense. A petition to open is an appeal to the court's equitable powers and is addressed to the sound discretion of the court; and a reviewing court will not reverse the determination of the lower court absent clear and manifest abuse of discretion. Foerst v. Rotkis, supra; Triangle Building Supplies and Lumber Co. v. Zerman, 242 Pa. Super. 315, 363 A.2d 1287 (1976); Cheltenham National Bank v. Snelling, 230 Pa. Super. 498, 326 A.2d 557 (1974). However, the discretion exercised by the lower court must be guided by Rule 2959(e), Pa.R.C.P. which states in pertinent part: "If evidence is produced which in a jury trial would require the issues to be submitted to the jury the Court shall open judgment." Thus the standard of sufficiency the court must employ is that of a directed verdict, viewing all evidence in the light most favorable to the petitioner and accepting as true all evidence and proper inferences therefrom supporting the defense, while rejecting the adverse allegations of the party obtaining the judgment. Greenwood v. Kodoich, 239 Pa. Super. 372, 376, 357 A.2d 604, 606.

The defenses which the Volucks and LVA assert in their respective petitions to open are the same. It was claimed that default or demand was a condition precedent to the exercise of the warrants of attorney, and that prior to the entry of both judgments neither a default nor a demand had occurred. IVB ...


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