Campbell v. Heilman Homes, Inc.

• Decision Date: 31 March 1975
• Citation: 335 A.2d 371,233 Pa.Super. 366
• Parties: Wilbur L. CAMPBELL and Clara U. Campbell v. HEILMAN HOMES, INC., Appellant.
• Court: Pennsylvania Superior Court

335 A.2d 371

233 Pa.Super. 366

Wilbur L. CAMPBELL and Clara U. Campbell v. HEILMAN HOMES, INC., Appellant.

Superior Court of Pennsylvania.

March 31, 1975.

William C. Robinson, Henninger & Robinson Butler, for appellant.

Leo M. Stepanian, Butler, for appellees.

Before WATKINS, President Judge, and JACOBS HOFFMAN, CERCONE, PRICE, VAN der VOORT and SPAETH, JJ.

PRICE, Judge.

This appeal comes before this court following the denial of a petition to open a default judgment entered by the lower court. Appellant contends that it has complied with the requirements for setting aside the default judgment. We agree and, therefore will reverse.

The lower court conducted a hearing on the petition to open the judgment, at which time Thomas C. Heilman, president of appellant corporation, testified. His testimony established that appellant is a Pennsylvania corporation with its principal office in Ford City, Armstrong County, Pennsylvania. Appellant also operated branch offices in Blairsville, Butler, and Zelienople. Appellees, Wilbur and Clara Campbell, purchased a mobile home from appellant at its Zelienople sales lot on February 28, 1973. Delbert Marvin, appellant's lot manager, handled the sale. Appellees later alleged that there were substantial defects in the mobile home. On December 12, 1973, appellees served appellant, through Marvin, with a complaint in assumpsit, duly endorsed with a notice to plead. The complaint was served at the Zelienople sales location, and alleged damages in the amount of $3,479.89.

Heilman's testimony indicated that the standard procedure established by the company required the lot managers to forward all important papers to the home office. Marvin, however, failed to follow this procedure and never relayed the complaint to the main office. Heilman also testified that during the time the complaint was served at the branch office, Marvin was reporting for work only one or two days a week. This failure to report for work led to Marvin's discharge on approximately December 20, 1973, and a new lot manager replaced him. The new manager, Walt Rubino, was instructed to inspect the files and send all important mail and papers to the main office. The complaint was thus discovered and forwarded to the Ford City office sometime between January 15 and 18, 1974. Appellant subsequently turned the case over to its attorney on approximately January 24, 1974, and he in turn referred the case to a Butler County lawyer for preparation. Meanwhile, on January 10, 1974, nine days after the last day for filing an answer or other pleading had passed, a default judgment was entered against appellant. Appellant presented its petition to open judgment to the lower court on February 6, 1974.

It is well settled in the Commonwealth that a petition to open a judgment may be granted only when three factors are present: (1) the petition to open is promptly filed; (2) the default is reasonable explained or excused; and (3) a defense to the cause of action is shown to exist on the merits. McCoy v. Public Acceptance Corporation, 451 Pa. 495, 305 A.2d 698 (1973). We have examined the record and agree with the lower court's decision that the petition to open was promptly filed and that a meritorious defense was set forth in the petition. ^[1]

We must, therefore, address ourselves to the issue of the default in failing to file a timely answer to the complaint. We are well aware that a petition to open a judgment is within the discretion of the court and will not be overturned in the absence of a clear, manifest abuse of that discretion. Pappas v. Stefan, 451 Pa. 354, 304 A.2d 143 (1973); Kilgallen v. Kutna, 226 Pa.Super. 323, 310 A.2d 396 (1973). We are, however, convinced that the appellant has reasonably explained the default and so the default judgment should have been opened. Sta-Rite Industries, Inc., Water King Division v. Century Water Treating and Lehman, 230 Pa.Super. 285, 326 A.2d 425 (1974).

Appellant's actions indicate it had every intention of making an afirmative defense to the complaint charges. This is not a case wherein failure to answer was a planned tactical decision. See Myers v. Mooney Aircraft, Inc., 429 Pa. 177, 240 A.2d 505 (1967); Kanai v. Sowa, 109 Pa.Super. 426, 167 A. 429 (1933). This is rather a case dealing with an unintentional omission to act. Our court has held that where failure to answer was due to an oversight, an unintentional omission to act, or a mistake of the rights and duties of the appellant, the default judgment may be opened. Samuel Jacobs Distributors, Inc. v. Conditioned Air, Inc., 223 Pa.Super. 466, 301 A.2d 907 (1973). See Balk v. Ford Motor Company, 446 Pa. 137, 285 A.2d 128 (1971); Fox v. Mellon, 438 Pa. 364, 264 A.2d 623 (1970).

The failure of appellant to respond to the complaint was occasioned by the inattentiveness of its employee. While we may not be in agreement with appellant's method of insuring that important papers reach their corporate appointed destination, we will not saddle it with a default judgment in this case. The mistake in the present case is not unlike a clerical error, which has been held to constitute sufficient legal justification to open a default judgment. Johnson v. Yellow Cab Company of Philadelphia, 226 Pa.Super. 270, 307 A.2d 423 (1973). Appellee will be in no way prejudiced by the opening of this judgment.

The order of the lower court is reversed.

HOFFMAN, J files a dissenting opinion in which JACOBS and SPAETH, JJ., join.

HOFFMAN, Judge (dissenting).

I cannot agree with the Majority's conclusion that the trial court abused its discretion in failing to grant appellant's petition to open judgment. I agree that appellant's petition was promptly filed and that a meritorious defense was averred. I fail to see, however, why the lower court's finding that appellant did not justify its failure to answer appellee's complaint amounts to an abuse of discretion.

As the Majority notes, a lower court's disposition of a petition to open judgment is a matter of discretion, and will not be overturned in the absence of a clear, manifest abuse of that discretion. Pappas v. Stefan, 451 Pa. 354, 304 A.2d 143 (1973); Balk v. Ford Motor Co., 446 Pa. 137, 285 A.2d 128 (1971). While lip-service is often paid to that term, it is rarely defined. It is necessary that we state exactly what we mean when we refer to an 'abuse of discretion': 'When the court has come to a conclusion by the exercise of its discretion, the party complaining of it on appeal has a heavy burden; It is not sufficient to persuade the appellate court that it might have reached a different conclusion if, in the first place, charged with the duty imposed on the court below; it is necessary to go further and show an abuse of the discretionary power. 'An abuse of discretion is not merely an error of judgment, but if in reaching a conclusion the law is overridden or misapplied, or the judgment exercised is manifestly unreasonable, or the result of partiality, prejudice, bias or ill-will, as shown by the evidence or the record, discretion is abused.' Mielcuszny et ux. v. Rosol, 317 Pa. 91, 93, 94, 176 A. 236.' Garrett's Estate, 335 Pa. 287, 292--93, 6 A.2d 858, 860 (1939). (Emphasis added). See also Mackarus Estate, 431 Pa. 585, 246 A.2d 661 (1968).

I respectfully submit that the Majority opinion fails to adhere to the proper standard of review an appellate court must employ when passing on a discretionary decision of a lower court. The Majority opinion is couched in language which does no more than indicate that the Majority, were it deciding the petition De novo, would have reached a different result: 'We are, however, convinced that the appellant has reasonably explained the default and so the default judgment Should have been opened.' (Emphasis added). Further, the Majority notes that '(o)ur court has held that where failure to answer was due to an oversight, an unintentional omission to act, or a mistake of the rights and duties of the...