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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JAMES D. HOLLAND AND SANDRA C. : IN THE SUPERIOR COURT OF
HOLLAND : PENNSYLVANIA
:
:
v. :
:
:
HARTSOCKS CUSTOM CABINETS :
AND HOME IMPROVEMENTS LLC AND : No. 1655 MDA 2021
CHARLES T. HARTSOCK, III :
:
Appellants :
Appeal from the Order Entered December 9, 2021
In the Court of Common Pleas of Huntingdon County Civil Division at
No(s): 2020-00902
BEFORE: DUBOW, J., McLAUGHLIN, J., and COLINS, J.*
MEMORANDUM BY McLAUGHLIN, J.: FILED: MARCH 17, 2023
Hartsocks Custom Cabinets and Home Improvement LLC (“LLC”) and
Charles T. Hartsock, III (“Hartsock”), (collectively, “Appellants”), appeal from
the order denying their petition to open and/or strike a default judgment and
granting James D. Holland and Sandra C. Holland’s (collectively, the
“Hollands”) motion for attorney’s fees. We affirm the portion of the order
denying the petition and quash the appeal from the portion of the order
granting attorney’s fees.
According to the Hollands’ complaint, in September 2019, the Hollands
hired the LLC to renovate their kitchen. Hartsock solely owns the LLC and
serves as its primary employee. The Hollands paid Appellants a deposit of
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* Retired Senior Judge assigned to the Superior Court.
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$3,000, and the work was to be completed by early November 2019. However,
the project was delayed and in December 2019, Appellants left the project
while it was still incomplete. The Hollands hired a different contractor to finish
the work.
On January 2, 2020, the Hollands filed a civil complaint against both the
LLC and Hartsock, individually, in magisterial district court. The magisterial
district judge found in favor of the Hollands and awarded them damages, plus
fees and costs, in the amount of $2,986.47.
On July 30, 2020, the LLC filed a notice of appeal of the magisterial
district court’s judgment to the Court of Common Pleas of Huntington County.
The Prothonotary issued a rule to file a complaint. The Hollands filed a
complaint against Appellants on August 20, 2020, naming both the LLC and
Hartsock as separate defendants. The Hollands served the complaint upon
Appellants by sending a single copy, addressed to both the LLC and Hartsock
in a cover letter, to their joint address of record via First Class Mail. Their
addresses of record were set forth in the magisterial district court case record
and were the same for both the LLC and Hartsock, namely 2764 Lincoln Way
West, Suite 3, Chambersburg, PA 17202. In addition to the damages originally
sought in the magisterial district court case, the Hollands’ complaint also
asserted a claim for attorney’s fees, raising the total damages to $4,795.72.
Appellants failed to file an answer to the complaint. The Hollands sent a
notice of intention to take default judgment on October 7, 2020 to Appellants
via First Class Mail at their joint address of record. The Hollands sent a single
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copy of the notice to Appellants, addressed to both the LLC and Hartsock in a
cover letter. The notice itself bore a caption naming both the LLC and Hartsock
as separate defendants. Appellants failed to respond. The Hollands filed a
praecipe to enter default judgment and the Prothonotary entered a default
judgment against Appellants on February 1, 2021, in the amount of
$4,795.72.
Approximately seven months later, the Hollands attempted to execute
on their judgment by having a sheriff’s sale scheduled for August 27, 2021.
Appellants filed an emergency motion to stay the execution of judgment the
day before the sheriff’s sale, which was granted. On September 8, 2021,
Appellants filed a petition to open and/or strike the default judgment. The
court heard argument on the petition and denied it on December 9, 2021. In
its order denying the petition, the court also granted the Hollands’ motion for
attorney’s fees. The court ordered the Hollands to submit an itemized list of
their attorney’s fees within 14 days of the date of the order so the court could
determine the appropriate amount of fees. However, Appellants filed the
instant appeal before the court had the opportunity to rule on the amount of
fees.1
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1 Although orders denying petitions to open/strike default judgments are
interlocutory, they are immediately appealable as of right. See Pa.R.A.P.
311(a)(1); Keller v. Mey, 67 A.3d 1, 3 (Pa.Super. 2013). Therefore, although
the issue of the determination of the amount of attorney’s fees is outstanding,
the portion of the order denying Appellants’ petition to open and/or strike is
appealable as of right.
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Appellants raise the following issues:
1. Did the trial court err, as a matter of law, by excusing
violations of the Rules of Civil Procedure regarding service
of documents through the application of Pa. R. Civ. P. 126
and denying Appellants’ petition to strike default judgment?
2. Did the trial court err by denying Appellants’ petition to
open default judgment?
3. Did the trial court err by awarding attorney fees to
Appellees when Appellants did not act in a manner
supporting fees under 42 Pa. C.S.[A.] § 2503, no findings of
fact were made by the trial court as to the awarding of
attorney fees, and the trial court 1925 opinion does not
identify a single section of § 2503(7) or § 2503(9) to which
the parties’ conduct would support a fee award?
Appellants’ Br. at 9.
Opening and striking a judgment are different remedies subject to
different standards. “A petition to strike a judgment is a common law
proceeding which operates as a demurrer to the record.” Resolution Trust
Corp. v. Copley Qu-Wayne Assocs., 683 A.2d 269, 273 (Pa. 1996) (citation
omitted). “A petition to strike a judgment may be granted only for a fatal
defect or irregularity appearing on the face of the record.” Id. (citation
omitted). “When deciding if there are fatal defects on the face of the record
for the purposes of a petition to strike a judgment, a court may only look at
what was in the record when the judgment was entered.” Cintas Corp. v.
Lee’s Cleaning Servs., Inc., 700 A.2d 915, 917 (Pa. 1997). On appeal, “our
standard of review is de novo and our scope of review is plenary.” U.S. Bank
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Nat'l Ass'n for Pa. Hous. Fin. Agency v. Watters, 163 A.3d 1019, 1028
n.9 (Pa.Super. 2017).
“A petition to open a default judgment is an appeal to the equitable
powers of the court.” Smith v. Morrell Beer Distribs., Inc., 29 A.3d 23, 25
(Pa.Super. 2011) (citation omitted). We review an order ruling on a petition
to open a default judgment for “a manifest abuse of discretion or error of law.”
Id. (citation omitted). A default judgment may be opened when the moving
party has: “(1) promptly filed a petition to open the default judgment, (2)
provided a reasonable excuse or explanation for failing to file a responsive
pleading, and (3) pleaded a meritorious defense to the allegations contained
in the complaint.” Myers v. Wells Fargo Bank, N.A., 986 A.2d 171, 175-76
(Pa.Super. 2009). The failure to satisfy any one prong of this test will result
in denial of the petition to open. Watters, 163 A.3d at 1028.
Appellants first claim the court erred in denying the petition to strike
because there is a fatal defect on the face of the record. Appellants point out
that the Hollands served only one copy of the complaint and subsequent
documents, including the notice of intention to take default judgment, to both
Appellants. They assert the Rules of Civil Procedure require service upon each
defendant individually and the trial court improperly excused the allegedly
improper service of the default notice by reference to Rule 126. Appellants
thus argue the judgment should have been stricken.
The procedures for appealing a judgment from a magisterial district
court are set forth in the Pennsylvania Rules of Civil Procedure Governing
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Actions and Proceedings Before Magisterial District Judges. Under Rule 1002,
an aggrieved party has 30 days after the date of the entry of judgment to
appeal from that judgment “by filing with the prothonotary of the court of
common pleas a notice of appeal[.]” Pa.R.C.P.M.D.J. 1002(A). Thereafter, if
the appellant was the defendant in the action before the magisterial district
judge, as in the instant case, the appellant “shall file” with the notice of appeal
“a praecipe requesting the prothonotary to enter a rule as of course upon the
appellee to file a complaint within twenty (20) days after service of the rule
or suffer entry of a judgment of non pros.” Pa.R.C.P.M.D.J. 1004(B).
Then, pursuant to Rule 1005, “[t]he party filing a complaint under Rule
1004 shall forthwith serve it upon the opposite party in the appeal by leaving
a copy for or mailing a copy to the address as shown in the magisterial district
court records[.]” Pa.R.C.P.M.D.J. 1005(D). “The address of the appellee for
the purpose of service shall be the address as listed on the complaint form
filed in the office of the magisterial district judge or as otherwise appearing in
the records of that office.” Pa.R.C.P.M.D.J. 1005(A).
Here, the record reflects that the Hollands sent via First Class Mail a
cover letter addressed to both Appellants, along with one copy of the
complaint. The complaint clearly captioned both Appellants as defendants in
the action. The complaint was mailed to Appellants’ address set forth in the
magisterial district court records – 2764 Lincoln Way West, Suite 3,
Chambersburg, PA 17202 – which was the same address for both Appellants.
Appellants do not dispute that this address was their address of record. Rule
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1005 only requires that the complaint be served at the opposite party’s
address of record. The Hollands did just that. The Hollands thus properly
served the complaint upon Appellants.
Appellants similarly claim the default judgment should be stricken
because a single notice of the intention to take default judgment was mailed
to both Appellants, instead of being sent to each Appellant individually.
Pennsylvania Rule of Civil Procedure 237.1(a) provides:
(2) No judgment of non pros for failure to file a complaint
or by default for failure to plead shall be entered by the
prothonotary unless the praecipe for entry includes a
certification that a written notice of intention to file the
praecipe was mailed or delivered
***
(ii) in the case of a judgment by default, after the failure
to plead to a complaint and at least ten days prior to the
date of the filing of the praecipe to the party against
whom judgment is to be entered and to the party’s
attorney of record, if any.
***
(4) The notice and certification required by this rule may not
be waived.
Pa.R.C.P. 237.1(a)(2)(ii), (4).
Here, the Hollands complied with the letter of the rule. Rule 237.1 on its
face does not require separate notice (or prohibit joint notice). The Hollands
mailed their notice of intention to take default judgment to the address of
record for both Appellants, and the caption in the notice clearly listed both
Appellants as parties. Appellants, once again, do not dispute that they
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received the notice or that the address to which it was sent was their address
of record.
Moreover, even if the Hollands were required to send two copies of the
notice, under the doctrine of substantial compliance, the trial court may
“overlook any procedural defect that does not prejudice a party’s rights.”
Womer v. Hilliker, 908 A.2d 269, 276 (Pa. 2006) (citation omitted)
(emphasis removed); see also Pa.R.C.P. 126 (“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”). Appellants do not
allege they suffered any harm or were prejudiced in any way by receiving only
one copy of the notice, instead of two. The trial court here did not find waiver,
which Rule 237.1(a)(4) prohibits, but rather found the allegedly improper
service excused as not affecting any party’s substantial rights. Thus, we agree
with the trial court’s determination that no fatal defect or irregularity was
apparent on the face of the record. Accordingly, this claim fails.
Appellants next argue the court erred in denying their petition to open
judgment. They claim they had a reasonable excuse for failing to file a
responsive pleading and promptly filed the petition when they learned of this
lawsuit. Hartsock testified at his deposition that after judgment was entered
in the magisterial district court, he entrusted his former assistant to “handle”
the matter. N.T. Deposition of Charles T. Hartsock, III, 10/13/21, at 42-43.
He stated that his assistant filed the instant appeal and that he was not aware
that she filed it. Id. at 41, 51-52. He also said he did not realize that he was
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personally a defendant in the magisterial district court case, and he thought
the judgment was entered against only the LLC. Id. at 17-18.
Hartsock further testified that his assistant received the complaint, the
notice of intention to take default judgment, and the entry of default judgment
at the Lincoln Way West address as part of her standard duties, but she never
brought these filings to his attention and instead filed them in the LLC’s regular
business records. Id. at 19-20, 63-64, 80-81. Hartsock asserted he did not
learn that a judgment had been entered against him until the sheriff arrived
at his house to issue a sheriff’s sale notice in August 2021. Id. at 13-14. He
stated he then looked at his business files and found the documents. Id. at
64. Hartsock testified he hired an attorney within one week of locating the
filings. Id. at 14-15, 71-72.
Appellants also argue they set forth meritorious defenses to the
complaint. They note there is no cause of action properly pled against Hartsock
in his individual capacity and there are no allegations suggesting that piecing
the corporate veil is appropriate. Appellants’ Br. at 36, 39. Appellants further
aver the LLC did not breach the contract and the delay in the kitchen project
was caused by the Hollands.
The court found Appellants failed to satisfy the first two prongs of the
test for opening a default judgment. It determined the petition was not
promptly filed and Appellants’ explanation for failing to file a responsive
pleading was not reasonable. Trial Ct. Op. at 20-21.
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Regarding the first prong of the test for opening a default judgment,
“[t]he timeliness of a petition to open a judgment is measured from the date
that notice of the entry of the default judgment is received.” Digital
Communications Warehouse, Inc. v. Allen Investments, LLC, 223 A.3d
278, 285 (Pa.Super. 2019) (citation omitted). The law does not establish a
specific time within which a petition to open a judgment must be filed to qualify
as timely. Rather, it directs the court to consider the length of time between
discovery of the entry of the default judgment and the reason for the delay.
Id. at 285-86. “In cases where the appellate courts have found a ‘prompt’ and
timely filing of the petition to open a default judgment, the period of delay has
normally been less than one month.” US Bank N.A. v. Mallory, 982 A.2d
986, 995 (Pa.Super. 2009) (citations omitted) (emphasis added).
Here, the default judgment was entered on February 1, 2021.
Appellants’ petition to open and/or strike the default judgment was filed on
September 8, 2021, approximately seven months later. Accordingly, we agree
with the trial court that this was not a prompt filing, and therefore, we discern
no abuse of discretion on the first prong.
As to the second prong, “[w]hether an excuse is legitimate is not easily
answered and depends upon the specific circumstances of the case. The
appellate courts have usually addressed the question of legitimate excuse in
the context of an excuse for failure to respond to the original complaint in a
timely fashion.” Mallory, 982 A.2d at 995 (citations omitted).
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In concluding Appellants did not provide a reasonable explanation for
failing to file a responsive pleading, the court found Hartsock’s attempt to
blame his assistant for failure to respond not credible. Trial Ct. Op. at 18. The
court stated:
If Defendant Hartsock is to be believed, he engaged [his
secretary] to serve as attorney for both himself and the LLC,
and relied on her to litigate [Appellants’] appeals before this
[c]ourt with no meaningful oversight whatsoever. . . .[I]t
defies belief that any business owner would have his
secretary serve as his attorney. Even assuming, arguendo,
that this is precisely what occurred, such an act is patently
unreasonable, and was taken by Defendant Hartsock, acting
on behalf of himself and the LLC, at his own peril.
Id. at 19 (footnote omitted). The court also rejected Hartsock’s claim that he
was unaware he was personally a defendant in the magisterial district court
action because he participated in that case and the notice of entry of judgment
clearly showed judgments entered against him and the LLC separately. Id. at
17-18.
We find no abuse of discretion. Appellants failed to offer a reasonable
excuse for their inaction. According to Hartsock’s testimony, he designated his
assistant to “handle” this matter. Although he claims that she did not bring
the complaint or the notice of intention to take default judgment to his
attention, he admitted that they were filed in the LLC’s business records, which
were readily accessible to him. See N.T. Hartsock Depo. at 64. Appellants also
failed to produce the assistant as a witness or offer any other evidence to
support their claim. See Dominic’s Inc. v. Tony's Famous Tomato Pie &
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Restaurant, Inc., 214 A.3d 259, 270 (Pa.Super. 2019) (stating that the
petitioning party in a default judgment bears the burden of producing
sufficient evidence to substantiate its claims). Moreover, the LLC is a corporate
entity, not a layperson, and should have had in place the proper means to
monitor its legal claims. See Kelly v. Siuma, 34 A.3d 86, 94 (Pa.Super.
2011); Myers, 986 A.2d at 178. We agree with the court that the facts in this
case do not amount to an oversight, an unintentional omission, or a mistake
that would permit the opening of the default judgment. See Flynn v. Am. W.
Airlines, 742 A.2d 695, 699 (Pa.Super. 1999). Rather, any harm suffered by
Appellants was the result of Hartsock’s decision to delegate responsibility for
the matter to a non-lawyer, without supervision or follow-up. Thus, Appellants’
argument fails.2
In their final issue, Appellants claim that the court erred in awarding
attorney’s fees to the Hollands. Since the trial court has not yet determined
the amount of attorney’s fees, the portion of the order granting the Holland’s
motion for attorney’s fees is not a final order because the order did not dispose
of all claims as required by Pa.R.A.P. 341(b)(1). We therefore quash that
portion of the appeal as interlocutory.
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2 Since we find that Appellants failed to satisfy the “prompt filing” and
“reasonable excuse” prongs, we do not address their argument regarding the
“meritorious defense” prong. See Siuma, 34 A.3d at 94.
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Appeal from that portion of the order denying Appellants’ petition to
open and/or strike is affirmed. Appeal from that portion of the order granting
attorney’s fees is quashed. Jurisdiction relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 3/17/2023
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