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JOSEPH WILLIAM O'BRIEN AND ELIZABETH M. O'BRIEN v. COMMONWEALTH PENNSYLVANIA (07/02/82)

decided: July 2, 1982.

JOSEPH WILLIAM O'BRIEN AND ELIZABETH M. O'BRIEN, APPELLANTS
v.
COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF PUBLIC WELFARE, APPELLEE



Appeal from the Order of the Court of Common Pleas of Butler County in case of Commonwealth of Pennsylvania, Department of Public Welfare v. Joseph William O'Brien and Elizabeth M. O'Brien, C.P. No. 74-537, revived at C.P. No. 79092.

COUNSEL

Robert J. Stock, for appellants.

Roger T. Margolis, Assistant Counsel, for appellee.

Judges Rogers, Craig and Doyle, sitting as a panel of three. Opinion by Judge Craig.

Author: Craig

[ 67 Pa. Commw. Page 291]

This is an appeal from an order of the Court of Common Pleas of Butler County, dismissing appellant O'Briens'*fn1 petition to show cause why the Department of Public Welfare (DPW) should not satisfy a judgment it had entered against the O'Briens as public assistance recipients.

Before receiving public assistance, the O'Briens entered into a reimbursement agreement with DPW*fn2 dated March 6, 1974, which allowed DPW to enter judgment against the O'Briens for $2,000, plus costs, for public assistance "granted or to be granted. . . ." The agreement contained no terms dealing with interest, and on April 29, 1974, DPW entered and filed the judgment agreement of record. Later the O'Briens offered to pay the judgment to remove its lien, and on January 23, 1981, DPW responded that the judgment would be satisfied upon payment, within ninety days, of $9,380.10, representing the total assistance received plus costs. Thereafter, the O'Briens paid DPW $2,012.40, the amount stated in the reimbursement agreement, plus costs. Although DPW then conceded that it was not entitled to reimbursement beyond the amount stated in the agreement, it refused to satisfy the judgment until the O'Briens should pay interest, calculated at 6% per annum from the date judgment was entered.*fn3

[ 67 Pa. Commw. Page 292]

DPW contends that it is authorized to charge interest from the date the judgment was entered pursuant to 42 Pa. C.S.A. ยง 8101, which is contained in the Judiciary and Judiciary Procedures Act,*fn4 and provides:

Except as otherwise provided by another statute, a judgment for a specific sum of money shall bear interest at the lawful rate from the date of the verdict or award, or from the date of judgment, if the judgment is not entered upon a verdict or award.

Despite the long existence of Section 8101 and its predecessor,*fn5 the issue of whether interest is collectible from the date a confessed judgment is entered, notwithstanding the occurrence of any default, apparently is one of first impression before our appellate courts. Therefore, in resolving this issue, we must consider the rationale of awarding interest on a judgment and examine the dual nature of a judgment entry in a confessed judgment proceeding.

Our Supreme Court has discussed the basis for awarding interest on judgments in Carbondale School District v. Fidelity and Deposit Co. of Maryland, 346 Pa. 491, 492, 31 A.2d 279, 280 (1943):

The appropriate definition of "interest" upon obligations reduced to judgment through litigation is stated in Kelsey v. Murphy, 30 Pa. 340, 341: "Interest has been defined 'to be a compensation allowed to the creditor for delay of payment by the debtor,' and is to be said to be impliedly due ...


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