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PAUL E. COURTNEY v. RYAN HOMES (08/16/85)

decided: August 16, 1985.

PAUL E. COURTNEY, ESQUIRE, LOUIS J. MERCANDANTE, JR. AND BEN J. MAURO, INDIVIDUALLY AND TRADING AS NORTHVIEW ESTATES DEVELOPMENT COMPANY, APPELLEES,
v.
RYAN HOMES, INC., APPELLANT



Appeal from Order of the Court of Common Pleas, Civil Division, of Beaver County, No. 521 of 1983 D.S.B.

COUNSEL

George R. Specter, Pittsburgh, for appellant.

Scott L. Melton, Conway, for appellees.

Brosky, Wieand and Lederer,*fn* JJ.

Author: Wieand

[ 345 Pa. Super. Page 111]

This is an appeal from an order denying a petition to strike and/or open a judgment entered by confession pursuant to a warrant of attorney contained in a mortgage note on which the petitioner was admittedly in default. Because

[ 345 Pa. Super. Page 112]

    the judgment is not defective and because the petitioner failed to show facts constituting a meritorious defense to the indebtedness, we affirm. However, we agree with the appellant that the court erred when it rendered an advisory opinion regarding the amount of land subject to the lien of the judgment.

On November 3, 1977, Ryan Homes, Inc. (Ryan) paid $10,000.00 for an option to buy two tracts of land in the Borough of Economy, Beaver County, from Paul E. Courtney, Esquire, Lewis J. Mercandante, Jr. and Ben J. Mauro, trading as Northview Estates Development Company (Northview Estates). The option agreement provided that if Ryan exercised its option, it would purchase the entire tract consisting of 123.44 acres for a consideration of $2,700.00 per acre. Ryan exercised the option, and closing was held on June 13, 1979. Ryan paid to Northview Estates the sum of $86,656.96 on account of a total purchase price of $333,299.87 and received a credit for the prior payment of $10,000.00 made as consideration for the option. A purchase money mortgage and accompanying note were executed by Ryan in favor of Northview Estates for the unpaid balance of $236,642.91. The note contained a schedule of payments requiring Ryan to pay three annual installments of $78,880.97 each on the first, second and third anniversary dates of the closing, with interest payable quarterly at a rate of seven percent per annum. The note contained a confession of judgment clause as follows:

In case default be made in the payment of the within obligation or any other sum due hereunder or under the aforesaid mortgage and maker fails to cure such default after receiving thirty (30) days' written notice thereof, maker hereby empowers any attorney of any court of record within the United States of America to appear for maker and, with or without declaration filed, confess judgment against the Undersigned in favor of any holder hereof, for the unpaid balance of the principal debt together with all other sums due hereunder, costs of suit and an attorney's commission of Five Hundred Dollars

[ 345 Pa. Super. Page 113]

($500.00) or five percent (5%) of the total indebtedness, whichever is smaller, on which judgment or judgments one or more executions may issue forthwith upon failure to comply with all of the terms and conditions of this note and the aforesaid mortgage. Maker hereby forever waives and releases all errors in said proceedings, waives stay of execution, the right of inquisition, and extension of time of payment, agrees to condemnation of the mortgaged premises levied upon by virtue of such execution, and waives all exemptions from levy and sale of the mortgaged premises that now is or hereafter may be enacted into law.

Clauses in both the mortgage and note provided that Ryan's liability was limited to the amount which could be recovered from the real estate securing the mortgage obligation and that Ryan should not be liable for any deficiency therein. The mortgage also provided for releases of real estate from the lien of the mortgage ...


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