Litigation

The litigation attorneys at Houston Harbaugh, P.C., are accomplished business trial lawyers, providing comprehensive support in litigation across a broad spectrum of matters throughout Pennsylvania, West Virginia, Ohio and other jurisdictions upon a special admission basis. Our clients are regional and national small, medium and large companies and individuals who seek well planned and aggressive, but cost effective litigation. We counsel, we budget, we have a deep bench, we act quickly when needed and we have experienced trial lawyers who know the courts and bench. We serve regularly as local counsel for some of the largest law firms in the country when they have matters in this region.

Creditor’s Failure to Allege Condition Precedent in Complaint in Confession of Judgment Cannot Be Cured through Amendment, Says PA Superior Court

Where a creditor files a complaint in confession of judgment but fails to allege the occurrence of a condition precedent, can the defect be cured through amendment in order to prevent exhaustion of the warrant of attorney? The Pennsylvania Superior Court has held “no,” finding that a creditor’s failure to allege the occurrence of a condition precedent is a substantive defect that voids the confessed judgment.

In The Dime Bank v. Andrews, 2015 PA Super 114 (May 8, 2015), the debtor was a personal guarantor of a corporate promissory note. The guarantee executed by the debtor included a warrant of attorney permitting the creditor bank to confess judgment in the event of default. As a condition precedent to confessing judgment, however, the creditor was required to provide the debtor with ten day’s written notice of the default.

Upon default, the creditor filed a complaint in confession of judgment against the debtor based on the warrant of attorney, but did not specifically allege that it had satisfied the condition precedent by providing the debtor with notice of the default pursuant to the guarantee. Rather, the complaint only generally alleged that the creditor had made demand on the debtor. The debtor subsequently petitioned to strike the confessed judgment because of the complaint’s failure to allege the occurrence of a condition precedent. Although the trial court agreed with the debtor that the complaint did not properly allege the occurrence of the condition precedent, it determined that the defect could be cured through amendment because the debtor was unable to demonstrate prejudice under the circumstances.  In accordance with the ruling, the creditor filed an amended complaint confessing judgment for a second time, prompting the debtor to appeal the trial court’s decision effectively refusing to strike the confessed judgment.

On appeal, the Superior Court reversed the decision of the trial court. According to the court, where a defect is “irremediable” like the defect at issue in the case, it is not even necessary to consider whether the party seeking to strike the judgment would be prejudiced by amendment. In concluding that the default was “irremediable,” the court relied primarily on its decision in A. B. & F. Contr. Corp. v. Matthews Coal Co., 166 A.2d 317 (Pa. Super. 1966), where it similarly had struck a judgment where the creditor failed to provide the debtor with notice of the default. Further, the court held that it would be improper to construe the creditor’s allegation that it had made demand on the debtor as pleading the occurrence of the condition precedent because warrants are to be construed strictly against the party in whose favor they are given.  The court concluded, therefore, that the confessed judgment should be stricken.

Perhaps what is most interesting about the Superior Court’s decision is not the result, but the unique procedural posture of the case. As the Superior Court noted, its decision to strike the judgment does not necessarily mean the end of the case because an amended complaint in confession of judgment remained pending in the trial court, and the guaranty expressly provided for multiple exercises of the warrant of attorney. The court left resolution of these issues to the trial court on remand.

About Us

The litigation attorneys at Houston Harbaugh, P.C., are accomplished business trial lawyers, providing comprehensive support in litigation across a broad spectrum of matters throughout Pennsylvania, West Virginia, Ohio and other jurisdictions upon a special admission basis. Our clients are regional and national small, medium and large companies and individuals who seek well planned and aggressive, but cost effective litigation. We counsel, we budget, we have a deep bench, we act quickly when needed and we have experienced trial lawyers who know the courts and bench. We serve regularly as local counsel for some of the largest law firms in the country when they have matters in this region.

Henry Sneath Pittsburgh Business Litigation Lawyer. Pittsburgh Strong.® DTSALaw® Complex Case Mediation and ADR

Henry M. Sneath - Practice Chair

Co-Chair of Houston Harbaugh’s Litigation Practice, and Chair of its Intellectual Property Practice, Henry Sneath is a trial attorney, mediator, arbitrator and Federal Court Approved Mediation Neutral and Special Master with extensive federal and state court trial experience in cases involving commercial disputes, breach of contract litigation, intellectual property matters, patent, trademark and copyright infringement, trade secret misappropriation, DTSA claims, cyber security and data breach prevention, mitigation and litigation, probate trusts and estates litigation, construction claims, eminent domain, professional negligence lawsuits, pharmaceutical, products liability and catastrophic injury litigation, insurance coverage, and insurance bad faith claims.

Sam Simon Houston harbaugh lawyer

Samuel H. Simon - Practice Chair

As co-chair of Houston Harbaugh’s Litigation Group, Sam focuses his practice on commercial/business litigation. Sam regularly represents clients in the construction, manufacturing, oil and gas, and wholesale/retail/ distribution industries, as well as individuals in matters such as:

  • Construction litigation
  • Environmental litigation
  • Breach of contract disputes
  • Oil and gas litigation
  • Negligence
  • Restrictive covenants (non-compete agreements)
  • Civil rights
  • Collections/creditors’ rights
  • Lease disputes