Lister, J. v. White Label Communications ( 2018 )

J-A25025-17
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JOHN W. LISTER AND LISA R. : IN THE SUPERIOR COURT OF
LISTER : PENNSYLVANIA
:
v. :
:
:
WHITE LABEL COMMUNICATIONS, :
LLC. :
: No. 1065 EDA 2017
Appellant :
Appeal from the Order Entered March 2, 2017
In the Court of Common Pleas of Chester County
Civil Division at No(s): 2016-10927-JD
BEFORE: OTT, J., STABILE, J., and STEVENS, P.J.E.
MEMORANDUM BY OTT, J.: FILED FEBRUARY 20, 2018
White Label Communications, LLC (White Label) appeals from the order
entered on March 2, 2017, in the Court of Common Pleas of Chester County,
denying White Label’s petition to open or strike the confessed judgment taken
by John W. and Lisa R. Lister (Listers). Specifically, White Label claims the
trial court erred in granting the petition without first issuing a rule to show
cause regarding the petition, pursuant to Pa.R.C.P. 2959(b). After a thorough
review of the submissions by the parties, relevant law, and the certified
record, we reverse and remand for the issuance of a rule to show cause on
White Label’s petition, thereby allowing the development of evidence as
contemplated by rule.
____________________________________________

Former Justice specially assigned to the Superior Court.
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We recite the procedural history of this matter as related by the trial
court in its Pa.R.A.P. 1925(a) opinion.
On November 17, 2016 [Listers] filed their Complaint in
Confession of Judgment based upon a confession of judgment
clause in paragraph 27.d of a Lease Agreement executed by
Plaintiff John W. Lister and Thomas R. Joseph on behalf of [White
Label]. On the same day, an Affidavit of Service of Notice of
Defendant’s Rights, Confession of Judgment and Complaint was
docketed. [White Label] filed its petition to Open or Strike
Confession of Judgment on December 16, 2016 and [Listers] filed
their response on January 5, 2017. As stated above, we denied
[White Label’s] Petition by Order dated March 2, 2017.
Trial Court Opinion, 5/15/2017, at 1.
We glean the facts underlying this action from the certified record.
Listers and White Label entered into a lease agreement for 2,400 square feet
of space at 1450 Boot Road, Site 400D, West Chester, Pennsylvania.
Complaint, Plaintiffs Exhibit 1, Lease, ¶¶ 1, 2. The term of the lease was for
three (3) years, commencing on October 1, 2013 and terminating September
30, 2016. Id. at ¶ 2, Complaint at ¶ 12. The Lease also contained an early
termination clause at ¶ 6.d that stated:
6. Term
***
d. Early Termination
i. Tenant may terminate this lease upon a minimum 120 day
written notice to landlord. Lease termination will take
place at the end of the calendar month following 120 days
from notice.
ii. In the event tenant elects to terminate early, Tenant will
compensate Landlord “Early Termination Rent.” Early
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Termination rent shall be equal to 50% of the rent due
under the terms of the lease from the date of early
termination to the end of the lease term.
iii. Early termination rent will be due 30 days prior to
termination.
Complaint, Plaintiffs Exhibit 1, at ¶ 6.d (i)-(iii).
Listers claimed that White Label vacated the property on or about March
30, 2016 and failed to pay rent for April, 2016 – September, 2016,
representing the final six months of the lease term. Id. at ¶ 12. Other than
in the Lease itself, Listers’ Complaint makes no mention of the early
termination clause, or any alleged attempt by White Label to invoke that
clause. Pursuant to Paragraph 27.d of the Lease, Listers sought a confessed
judgment in the amount of $25,885.81. Judgment in that amount was
docketed on November 17, 2016.
On December 16, 2016, White Label filed a timely Petition to Open or
Strike the Confessed Judgment, claiming it had invoked the early termination
clause and had tendered $8,275.02, which represented the full 50% of the
remaining rent due, as required by the Lease. Along with the petition, White
Label also filed a Praecipe for Determination, asking for a Rule to Show Cause
why said petition should not be granted. As noted above, Listers filed their
answer to the petition on January 5, 2017 and the trial court denied White
Label’s petition, without a hearing, on March 2, 2017. White Label filed this
timely appeal.
Initially, we note,
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[A] petition to open a judgment is an appeal to the equitable
powers of the court. It is committed to the sound discretion of the
hearing court and will not be disturbed absent a manifest abuse
of that discretion. Ordinarily, if a petition to open a judgment is to
be successful, it must meet the following test: (1) the petition to
open must be promptly filed; (2) the failure to appear or file a
timely answer must be excused; and (3) the party seeking to open
the judgment must show a meritorious defense.
Century Surety Co. v. Essington Auto Center, LLC, 140 A.3d 46, 53 (Pa.
Super. 2016) (citation omitted).
Further,
A trial court's decision to deny a petition to open or strike a
judgment of non pros is scrutinized on the abuse of discretion
standard of appellate review.
Madrid v. Alpine Mountain Corp., 24 A.3d 380, 382 (Pa. Super. 2011)
(citation omitted).
Relevant to this matter, Pa.R.C.P. 2959(b) states:
If the petition states prima facie grounds for relief the court shall
issue a rule to show cause and may grant a stay of proceedings.
After being served with a copy of the petition the plaintiff shall file
an answer on or before the return day of the rule. The return day
of the rule shall be fixed by the court by local rule or by special
order.
Pa.R.C.P. 2959(b).
The disposition of the rule is governed by Rule 2959(e), which states:
The court shall dispose of the rule on petition and answer, and on
any testimony, depositions, admissions and other evidence. The
court for cause shown may stay proceedings on the petition
insofar as it seeks to open the judgment pending disposition of
the application to strike off the judgment. If evidence is produced
which in a jury trial would require the issues to be submitted to
the jury the court shall open the judgment.
Pa.R.C.P. 2959(e).
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Pursuant to Rule 2959(b), if the defendant’s petition to open the
judgment states prima facie grounds for relief, then the trial court shall issue
a rule to show cause. If grounds are so stated, evidence of record is to be
developed and a hearing, if necessary, will be held. Here, the petition was
filed in a timely manner and it presented a prima facie meritorious defense,
namely, that White Label had provided Listers with notice of its intent to
exercise the early termination clause and that it had paid the required sum.
The trial court prematurely based its decision on Listers’ answer to the
Petition, by not allowing White Label the opportunity to test Listers’ claims and
to present its own evidence in support of its Petition.
We note that Listers have also argued that White Label failed to follow
the local rules in seeking the rule to show cause, specifically, they claim White
Label was required to submit the rule to show cause to the court administrator
for “‘per curiam signature’ in accordance with C.C.R.C.P. 206.4(c)(1).”
Appellee’s Brief at 8. Instead, Listers argue, White Label submitted a praecipe
for determination seeking the issuance of a “per curiam rule to show cause.”
Id. The trial court did not dispose of this matter based on any alleged failure
to follow the local rules, so we will not address this argument. Nonetheless,
our review of the certified record indicates White Label sought submission of
“the Rule to Show Cause attached to the Petition to Open or Strike Confession
of Judgment to the Court Administrator for Per Curiam signature pursuant to
Local Rule 206.4(c)(1).” See White Label’s Praecipe for Determination,
12/16/2016.
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In light of the foregoing, we vacate the order denying White Label’s
petition to open or strike the confession of judgment, and remand for the
issuance of a rule to show cause, forthwith, allowing for the development of
evidence as contemplated by Pa.R.C.P. 2959.
Order vacated. This matter is remanded for further action consistent
with this decision. Jurisdiction relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 2/20/2018
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