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07/02/97 PETERS TOWNSHIP SANITARY AUTHORITY v.

COMMONWEALTH COURT OF PENNSYLVANIA


July 2, 1997

PETERS TOWNSHIP SANITARY AUTHORITY
v.
AMERICAN HOME AND LAND DEVELOPMENT COMPANY AND QUAIL RUN ASSOCIATES AND QUAIL RUN SANITARY CORPORATION, AND WILLIAM K. KERSCHBAUMER; QUAIL RUN SANITARY CORPORATION, APPELLANT

Appealed From No. 96-1367. Common Pleas Court of the County of Washington. Judge TERPUTAC.

Before: Honorable Doris A. Smith, Judge, Honorable Rochelle S. Friedman, Judge, Honorable Emil E. Narick, Senior Judge. Opinion BY Judge Friedman.

The opinion of the court was delivered by: Friedman

OPINION BY JUDGE FRIEDMAN

FILED: July 2, 1997

Quail Run Sanitary Corporation (Quail Run), appeals from the opinion and order of the Court of Common Pleas of Washington County (trial court) denying Quail Run's Petition to Open Default Judgment. We reverse.

Peters Township Sanitary Authority (Peters Township) filed suit against Quail Run on April 10, 1996. When Quail Run failed to respond within twenty days, Peters Township mailed to Quail Run a notice of intention to enter judgment dated May 2, 1996, and filed a praecipe to enter judgment by default on May 14, 1996 at 12:07 p.m.. Quail Run filed preliminary objections to Peters Township's complaint approximately fifteen minutes later; however, unbeknownst to Quail Run, the default judgment had already been entered. On May 17, 1996, Quail Run filed the instant petition to open judgment.

The trial court disagreed with Quail Run's contention that opening the judgment was proper under Rule 237.3 of the Pennsylvania Rules of Civil Procedure, which states:

(a) A petition for relief from a judgment of non pros or of default entered pursuant to Rule 237.1 shall have attached thereto a verified copy of the complaint or answer which the petitioner seeks leave to file.

(b) If the petition is filed within ten days after the entry of the judgment on the docket, the court shall open the judgment if the proposed complaint or answer states a meritorious cause of action or defense.

Pa. R.C.P. No. 237.3. (Emphasis added.) The trial court held that, because Quail Run attached preliminary objections, rather than an answer, to the petition to open, it had not complied with Rule 237.3. Additionally, the trial court implied that Quail Run's preliminary objections did not state a meritorious defense. Accordingly, the trial court denied the petition to open.

On appeal to this court, *fn1 Quail Run first argues that the trial court erred in strictly construing the term "answer" within the text of Rule 237.3, thereby rejecting the filing of a "pleading" in the nature of preliminary objections. According to Quail Run, a standard of liberality, not strictness, should be applied in ruling on a petition to open default judgment. See Pa. R.C.P. No. 126. *fn2 Further, Quail Run contends that examination of the default judgment provisions of Rules 1037 and 237, and their respective Commentary Notes, reveals that the court should accept a "pleading" in the form of preliminary objections with regard to Rule 237.3. The Explanatory Comment regarding Rule 1037 states:

Rule 1037. Judgment Upon Default or Admission. Assessment of Damages.

Subdivision (b) of Rule 1037 provided for the entry of judgment upon praecipe resulting from a default or admission. The rule spoke of failure to file "an answer." This left unclear the effect of filing preliminary objections. This rule is changed to refer to "a pleading," a term which under Rule 1017(a) includes both an answer and preliminary objections. The filing of an answer or preliminary objections will clearly prevent the entry of a default judgment.

Pa. R.C.P. No. 1037 (Explanatory Comment - 1994).

Quail Run contends that, if Rule 1037, regarding prevention of the entry of default judgment, allows for the filing of preliminary objections, it follows that, under Rule 237.3, regarding relief from the entry of default judgment, preliminary objections may also be properly filed. Quail Run notes that, although the language of Rule 237.3(b) (emphasis added) states that "... the court shall open the judgment if the proposed complaint or answer states a meritorious cause of action or defense," the Explanatory Comment regarding subdivision (b) uses the more inclusive term "proposed pleading" and provides:

Subdivision (b) eases the burden of a party against whom judgment has been entered and who moves promptly for relief from that judgment. If the petitioner files a petition for relief from the judgment within ten days after entry of the judgment on the docket, the rule requires the court to open the judgment if the proposed pleading states a meritorious cause of action or defense .... *fn3

Thus, Quail Run argues that preliminary objections, in addition to answers, are appropriate attachments to a petition to open, and the trial court erred by holding otherwise. *fn4 We agree.

Based on our review of Rules 126, 237.3 and 1037, in conjunction with their associated Explanatory Notes, we conclude that Quail Run did not invalidate its Petition to Open by attaching preliminary objections, rather than a complaint or answer, to that Petition, and we believe that the trial court abused its discretion by finding that it did.

Quail Run next asserts that the trial court erred in finding that Quail Run failed to set forth a meritorious defense in its preliminary objections. Under Rule 237.3(b), in order to open judgment, the petition must assert a meritorious defense. *fn5

Quail Run argues that it alleged a meritorious defense in its preliminary objections by raising the Statute of Frauds defense contained in section 1 of the Uniform Written Obligation Act, Act of April 26, 1855, P.L. 308, as amended, 33 P.S. § 3, which states in relevant part: "no action shall be brought whereby ... to charge the defendant ... to answer for the debt or default of another ...." *fn6 This statute is a non-waivable bar to the action which may be raised by demurrer, as it was here. *fn7 Quail Run contends that this is a meritorious defense because, if proven, it will justify relief on behalf of Quail Run. We must agree and, thus, conclude that the trial court abused its discretion by finding that Quail Run failed to present a meritorious defense.

In considering petitions to open default judgments, a court must determine whether there are equitable considerations which require that a defendant, against whom a default judgment has been entered, receive an opportunity to have the case decided on the merits. Duckson v. Wee Wheelers, Inc., 423 Pa. Super. 251, 255, 620 A.2d 1206, 1208 (1993). Generally, default judgments are not favored. Kennedy v. Black, 492 Pa. 397, 402, 424 A.2d 1250, 1252 (1981). It has been stated in regard to default judgments that:

the purpose of the rules in authorizing the entry of default judgments is to prevent a dilatory defendant from impeding the plaintiff in establishing his claim. The rules are not primarily intended to provide the plaintiff with a means of gaining a judgment without the difficulties which arise from litigation....

Tronzo v. Equitable Gas Co., 269 Pa. Super. 392, 395-96, 410 A.2d 313, 315 (1979), quoting Moyer v. Americana Mobile Homes, Inc., 244 Pa. Super. 441, 445, 368 A.2d 802, 804 (1976).

Here, Quail Run argues that, because it filed the Petition to Open and attached responsive pleading only four days beyond the original deadline, and because the original responsive pleading was filed only fourteen minutes after the praecipe for default judgment was entered, Quail Run was not a "dilatory defendant" and the equities of the case demand that the default judgment be opened.

Because Quail Run's Petition to Open Judgment was promptly filed, presented a meritorious defense and generally complied with the Pennsylvania Rules of Civil Procedure, we agree that Quail Run was not a dilatory defendant and that the trial court abused its discretion by denying Quail Run's Petition to Open Judgment.

Accordingly, we reverse.

ROCHELLE S. FRIEDMAN, JUDGE

ORDER

AND NOW, this 2nd day of July, 1997, the order of the Court of Common Pleas of Washington County, dated June 17, 1996, is hereby reversed.

ROCHELLE S. FRIEDMAN, JUDGE


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