Huntington Nat'l Bank v. K-Cor, Inc.
Decision Date | 31 December 2014 |
Docket Number | No. 1265 WDA 2013,1265 WDA 2013 |
Citation | 107 A.3d 783,2014 PA Super 290 |
Parties | The HUNTINGTON NATIONAL BANK, Successor in Interest to Sky Bank, Appellee, v. K–COR, INC., Appellant. |
Court | Pennsylvania Superior Court |
Gianni Floro, Moon Township, for appellant.
William C. Price, Pittsburgh, for appellee.
BEFORE: BENDER, P.J.E., BOWES, J., and ALLEN, J.
K–Cor, Inc. (Appellant) appeals from the order entered on July 12, 2013, denying its petition to strike or open judgment entered by confession. We affirm.
The following facts are not in dispute. This case involves guarantees on two commercial loans. In November 2000, Huntingdon National Bank's predecessor, Sky Bank, entered into a loan agreement with Rock Airport of Pittsburgh, LLC (Airport LLC), pursuant to which the bank loaned $3,000,000 to Airport LLC. Appellant guaranteed the loan. The guaranty provides for judgment by confession in the event of a default on the loan.
In June 2002, the bank and Airport LLC entered into a second loan agreement, pursuant to which the bank loaned an additional $370,000 to Airport LLC. Appellant guaranteed the loan. The guaranty provides for judgment by confession in the event of a default on the loan.
Following default and notice, Huntington National Bank (hereinafter, the Bank) initiated this action in May 2013, filing a complaint in confession of judgment. Thereafter, judgment was entered in the total amount of $3,282,049.77. See Notice of Judgment, 05/22/2013.
In June 2013, Appellant filed a petition to strike or open the judgment, comprised of a single paragraph averring that it had not voluntarily, intelligently, and knowingly given up its right to notice and a hearing prior to the entry of judgment. In July 2013, following argument, the trial court denied Appellant's petition, concluding that Appellant had failed to raise a meritorious defense to the confessed judgment. The trial court further denied Appellant's oral motion to amend its petition, concluding that the general rule permitting liberal amendment of pleadings does not apply to a petition to strike or open. Appellant filed a motion for reconsideration, attaching proposed amendments to its petition, which was denied thereafter by the trial court. Appellant timely appealed and filed a court-ordered Pa.R.A.P.1925(b) statement. The trial court submitted a responsive opinion, addressing both the defect in Appellant's initial petition as well as the substantive merit of Appellant's proposed amendments.
Appellant raises the following issues on appeal:
Appellant's Brief at “vi.”
In its first issue, Appellant contends that the trial court should have permitted Appellant to amend its original petition and that its proposed amendments support opening the confessed judgment.1 We review a court's order denying a petition to open a confessed judgment for an abuse of discretion. PNC Bank, Nat'l Ass'n v. Bluestream Tech., Inc., 14 A.3d 831, 835 (Pa.Super.2010). However, to the extent that Appellant challenges the lower court's interpretation of the Pennsylvania Rules of Civil Procedure, our standard of review is de novo, and our scope of review is plenary.See Midwest Fin. Acceptance Corp. v. Lopez, 78 A.3d 614, 624 (Pa.Super.2013) (citing Boatin v. Miller, 955 A.2d 424, 427 (Pa.Super.2008) ); see also Pa.R.C.P. 127 ( ); Pa.R.C.P. 129 (same).
Petitions to strike or open judgment by confession are governed by Pennsylvania Rules of Civil Procedure 2959 and 2960.
Relief from a judgment by confession shall be sought by petition. Except as provided in subparagraph (2), all grounds for relief whether to strike off the judgment or to open it must be asserted in a single petition.
Pa.R.C.P. 2959(a)(1) (emphasis added); see also Pa.R.C.P. 2959(a)(2) ( ); Pa.R.C.P. 2959(c) (); Pa.R.C.P. 2960 ( ).
Appellant does not dispute the plain language of Rule 2959. Rather, Appellant maintains that there are meritorious defenses to the Bank's complaint and that the absence of either factual allegations or defenses in its petition was merely an “administrative oversight,” easily cured through amendment. Appellant's Brief, at 9. Appellant suggests its error became apparent at the outset of the hearing, prior to any determination by the trial court, notes the liberal policy of amendment that prevails in Pennsylvania, and argues that the Bank would have suffered no prejudice if Appellant had been permitted to amend. Id. at 11–12 (citing, inter alia, Pa.R.C.P. 126 ). Thus, Appellant concludes, the trial court erred.
In contrast, the Bank contends that no amendment is permitted under the rules. The Bank notes that a party waives all defenses and objections that are not included in the petition, citing in support Pa.R.C.P. 2959(c), and asserts that Pennsylvania courts have consistently applied our procedural rules to prohibit defendants from amending petitions to strike or open.
For its part, the trial court concluded that Appellant's petition could not be amended. In its opinion, the court stated it could not “ignor[e] the clear and unambiguous language of the [r]ules of [c]ourt.” Trial Court Opinion (TCO), May 14, 2014, at 5. The court offered no precedent in support of its decision, rejected Appellant's plea to the equitable powers of the court, and found irrelevant the question whether amendment would prejudice the Bank. Id. at 6.
To the extent the trial court determined it was powerless to permit amendment, we disagree. The language employed in Rule 2959 is not unlike that found in Rule 1028 governing preliminary objections. That Rule states, in relevant part:
All preliminary objections shall be raised at one time. They shall state specifically the grounds relied upon and may be inconsistent. Two or more preliminary objections may be raised in one pleading.
Pa.R.C.P. 1028(b) (emphasis added); see also Pa.R.C.P. 1032(a) ( ).
The purpose of the requirement that a party raise all objections at one time is “to reduce the number of dilatory steps [available to a party] ... and thus expedite the reasonable disposition of the litigation.” Yentzer v. Taylor Wine Co., 409 Pa. 338, 186 A.2d 396, 398 (1962) ; see also Wagner v. Wagner, 564 Pa. 448, 768 A.2d 1112, 1120 n. 3 (2001) ; Bowman v. Meadow Ridge, Inc., 419 Pa.Super. 511, 615 A.2d 755, 757 (1992). The single-petition requirement in Rule 2959 fulfills the same purpose. See generally Pa.R.C.P. 206.1 (Explanatory Comment—2013).
However, this Court has previously permitted amendment of preliminary objections. See Bowman, 615 A.2d at 757 ( ); see also Dep't of Transp. v. Schodde, 61 Pa.Cmwlth. 77, 433 A.2d 143, 145 (1981) ().
More generally, the purpose of our procedural rules is to facilitate the administration of justice, and our courts should apply them with that purpose in mind.
The rules shall be liberally construed to secure the just, speedy and inexpensive determination of every action or proceeding to which they are applicable. The court at every stage of any such action or proceeding may disregard any error or defect of procedure which does not affect the substantial rights of the parties.
Pa.R.C.P. 126 ; see also In re Larsen, 571 Pa. 457, 812 A.2d 640, 650 (2002) () (citing McKay v. Beatty, 348 Pa. 286, 35 A.2d 264, 265 (1944) ); Yentzer v. Taylor Wine Co., 409 Pa. 338, 186 A.2d 396, 398 (1962).
Finally, we conclude that the appellate decisions cited by the Bank are distinguishable from the matter currently before this Court. See, e.g., Davis v. Woxall Hotel, Inc., 395 Pa.Super. 465, 577 A.2d 636, 638–39 (1990) ( ); C–Rich Co. v. Davis, 383 Pa.Super. 31, 556 A.2d 413, 417–18 (1989) (...
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