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Archive for the tag “owe”

Don’t Like An Award From Compulsory Arbitration? You Must Appeal

Can a party to a case where a judgment has been entered in compulsory arbitration have that judgment modified without appealing? This is the underlying question in the recent matter heard by the Pennsylvania Superior Court, captioned as Blucas v. Agiovlasitis, 2018 Pa.Super. 25.

In Blucas, tenants brought suit against their former landlord for the return of their security deposit. The landlord, of course, claimed the leasehold had damages for which he incurred expenses and he needed compensation/reimbursement from the tenants.

The case was tracked into compulsory arbitration pursuant to 42 Pa.C.S.A. Section 7361. After a hearing before a panel of arbitrators, a judgment was entered awarding the tenants $10,000 and the landlord $1,450, for a net award to the tenants of $8,550.

Pursuant to Pa.R.C.P. 1307 and established case law, the entry of an award following compulsory arbitration has the force and effect of a final judgment. The court contrasted an award flowing from compulsory arbitration with one following statutory or common law arbitration. Unlike an award from compulsory arbitration, a party must petition the trial court to confirm an award from statutory or common law arbitration 30 days or more following the date of the award. For an award from compulsory arbitration neither party must file a præcipe to enter judgment on the award.

In July 2016, an award and notice of the same was entered on the docket in this matter, and was final (unless appealed). A judgment on the award was entered in November 2016. Within less than two weeks following the entry of the judgment in Blucas, the landlord remitted a check to the tenants for the full amount of the judgment ($8,550). Pursuant to Pa.R.C.P. 1307, a party must file an appeal within 30 days from when the award and notice are entered on the docket in order to further litigate the matter. No appeal was ever filed. Instead of appealing, the tenants, in April 2017, filed a motion for costs and prejudgment interest (motion) requesting a recalculation of the award.

The court reviewed the various case, statutory, and procedural laws applicable to the instant matter, and unequivocally concluded that the sole remedy for an adverse or unsatisfactory compulsory arbitration award is an appeal within 30 days from the award and notice. The only exception to the above the court could discern is Pa.R.C.P. 1307(d), which provides for a means to “mold” a previously entered award for obvious errors, in either arithmetic or language, that do not go to the substance and/or merits of the award.

The tenants’ motion did not address basic errors in arithmetic and language but, rather, asked the trial court to award them additional damages in prejudgment interest and costs. Inexplicably, and without citing support, the trial court granted the tenants’ motion, which led to the landlord’s appeal to Pennsylvania Superior Court, resulting in the decision, cited above, that is the subject of this article.

Superior Court noted that the motion did not comply with the law and procedure cited above.  The motion clearly is not an example of “molding.” More importantly, it was not filed within 30 days of the award.  The trial court was unclear as to precisely how it calculated the award and what the figures in the award exactly represented (e.g., interest and costs? security deposit? pet deposit? etc.). As a result, there is no way for Superior Court to even attempt to “mold” the award regarding prejudgment interest, even if it could. Consequently, as the tenants did not file an appeal of the compulsory arbitration award, the trial court was without authority to attempt to revisit the award with regard to prejudgment interest.

As always, it is absolutely critical for practitioners to be totally cognizant of the applicable deadlines and time periods mandated by law or procedure and act accordingly to ensure compliance with the same and opportunity to litigate a matter as fully as possible.

Originally published in The Legal Intelligencer on March 19, 2018 and can be found here.

A Collection of Personal Injury Writings by James W. Cushing, Esquire

Over the course of my career, I have written extensively on a wide variety of personal injury legal principles.  These writings have been published in The Legal IntelligencerUpon Further Review, and The Pennsylvania Family Lawyer as well as posted onto my blog.  I have collected these articles and blog posts and have listed them below.  Thanks for reading!


My Articles:

A Collection of Contract and Debt Collection Writings by James W. Cushing, Esquire

Over the course of my career, I have written extensively on a wide variety of contract law issues and debt collection legal principles.  These writings have been published in The Legal IntelligencerUpon Further Review, and The Pennsylvania Family Lawyer as well as posted onto my blog.  I have collected these articles and blog posts and have listed them below.  Thanks for reading!

My Articles:


The Secret Defense to Debt Collection Matters

Unfortunately, many people find themselves in a situation where they get behind on paying their bills and, due to lack of funds, wind up not paying some of them.  Not paying one’s bills will more often than not result in that debt being sold to a collections agency and that agency suing the debtor for payment (and adding on all kinds of things, like interest, attorney’s fees, penalties and the like to boot).

Selling one’s debt to a collection agency is an important step in the process that directly affects the subsequent lawsuit against the debtor.  Typically, large lenders – especially lenders like credit cards companies – have a fair amount of debtors who stop paying (for whatever reason) on the debt owed to the lender which results in their debts being sent to collections.  When these lenders send debts to collections, they do so by selling the debts to a collection agency.  When they sell the debts to a collection agency, they will often sell the debts in bulk, often for pennies on the dollar.  The transaction benefits the creditor as it gets something for the debts owed without having to pursue costly and time consuming litigation.  The transaction benefits the collection agency because it can pursue collection (including law suit) against a debtor for the full amount despite having bought the debt for far less than its principal value, let alone its value inflated by interest and such.

More often than not, when debts are sold to collection agencies, the initial creditor (e.g.: a credit card company) simply provides an affidavit to the collection agency regarding the amount of the debts and the names of those who owe the debts.  Typically, no other document is supplied by the initial creditor to the collection agency, including any contracts with the debtor or anything bearing the signature on the debtor.  Once the collection agency assumes the debt, it has the right to bring suit against the debtor for the unpaid debt.

The lack of documentation of the contract with the debtor is absolutely key to any defense to the collection of the debt.  If the creditor brings suit against the debtor in the Court of Common Pleas and does not attach the contract between the debtor and the creditor which underlies the alleged debt, the debtor can file objections to the complaint (the document which initiates the law suit) asking for it to be dismissed due to the lack of a contract.  I can say, from personal experience, that such a tactic works as, very often, the collection agency pursing the debtor simply does not have the underlying contractual documentation to prove its case against the debtor.

If the case is brought in small claims court, the creditor does not have the obligation to include a copy of the contract to the complaint, so successfully defending against a collections law suit takes some shrewd strategy.  The lack of documentary evidence is still a huge problem for the creditor, but the small claims aspect of this matter makes the approach different and much trickier.  As the complaint does not require the contract to be appended to it, and the primary place for these matters to be resolved is at a hearing before a judge, the creditor has the procedural advantage.  At the hearing, the collection agency, armed with an affidavit from the initial creditor (as described above), secures almost all of the other evidence it needs to win against the debtor through the debtor’s testimony.

Here is how the hearing would play out: the creditor describes the claim to the judge, which is that the debtor had a contract with a credit card company (for example), he did not pay the debt owed, and is now in collections and all of this is supported by the affidavit.  Now, the affidavit, taken alone, is insufficient to win the case as there is no evidence that the debtor actually contracted with the creditor.  So, at the appropriate time during the trial, the creditor will ask the debtor some questions (i.e.: cross-examination).  These questions will be something like: “did you have a credit card from XYZ company on these dates”?  “Did you make charges on it?” “Did you make all the payments on it?”  “Do you owe $XYZ on the credit card?” And other questions like it.  At the end of the examination, the debtor himself provides all of the evidence against himself that the creditor needs to win the case against him.   As a result, the creditor will win the case against the debtor thanks to the debtor supplying all of the evidence, via his testimony, need by the creditor.

So, how does a debtor avoid the fate of the debtor in the above scenario?  That is where a good lawyer comes into play.

Acknowledging a Debt to Toll the Statute of Limitations

As every lawyer knows, the statute of limitations is the death knell for any case if the deadline it sets to bring a lawsuit is missed.

Collecting on money owed pursuant to a contract is generally governed by a four (4) year statute of limitations which begins to run upon the breach of that contract. One way to extend that four (4) year statute is to find a way to toll it. The case of In Re Michael Angelo Corry Inn, Inc., 297 B.R. 435 (W.D., PA 2003), provides one innovative way to try and toll it.  Specifically, the Court in the above case analyzed whether acknowledging a debt and promising to repay serves as a way to toll the statute of limitations.

The underlying case involved the filing of a proof of claim by a creditor against a debtor who has filed for bankruptcy. The fact that the context of the case was bankruptcy has no effect or relevance on how the statute of limitations for a contract claim functions and/or applies. The issue was the fact that the creditor did not pursue the alleged debt with any alacrity and many years passed with no action taken on the loan and/or its repayment. The time that elapsed from the potential breach was longer than four (4) years in this case and, therefore, on its face, any action to pursue the contract claim would then be barred by the relevant statute of limitations. In order to avoid the contract claim from being a non-starter due to being barred by the statute of limitations, the creditor attempted to argue that the aforesaid statute is tolled by an acknowledgment of the debt made my the debtor.

The Court agreed that the statute of limitations on contract claims can be tolled if the debtor acknowledges a debt. The caveat, however, is that acknowledgment is more than merely expressing a willingness to pay it.

The acknowledgement doctrine requires a debtor’s acknowledging the existence of, and obligation for, a debt to be clear, distinct, and unequivocal, along with a promise to pay that is similarly doubtless. The Court made it clear that there must be no uncertainty in the debtor’s identification of the specific debt owed, acknowledgment of his own obligation to pay that debt, and a clear promise to pay. A debtor who simply declares an intention or desire to honor his obligation is not considered to have made a promise to pay sufficient to toll the statute of limitations under the acknowledgment doctrine.

So, when litigating a breach of contract claim for an unpaid debt, if one thinks the case can no longer be pursued due to the expiration of the statute of limitations, remember to fully explore the acknowledgement doctrine. It may allow a creditor to successfully pursue a debtor far beyond the four (4) years permitted by the statute of limitations.

Originally published on September 8, 2014 in The Legal Intelligencer Blog and can be found here.

Christian Legal Clinics of Philadelphia – June 2015 Update

The Christian Legal Clinics of Philadelphia’s monthly newsletter is out and can be seen below.  I hope that as the weeks and months progress, the Clinic can continue to grow and flourish in its service to those in need in the Philadelphia area.  Please continue to pray for us and donate to us your time, talents, and treasure as you feel led (if you want to give to our ministry, please see here).  Thanks to everyone who makes this vital ministry possible and thanks, above all, to God from whom all blessings flow.

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Christian Legal Clinics of Philadelphia – April 2015 Update

The Christian Legal Clinics of Philadelphia’s monthly newsletter is out and can be seen below.  I hope that as the weeks and months progress, the Clinic can continue to grow and flourish in its service to those in need in the Philadelphia area.  Please continue to pray for us and donate to us your time, talents, and treasure as you feel led (if you want to give to our ministry, please see here).  Thanks to everyone who makes this vital ministry possible and thanks, above all, to God from whom all blessings flow.


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Strict Compliance with the Municipal Liens Act is Required to Collect

The Commonwealth Court of Pennsylvania (“Court”), in the matter of City of Philadelphia v. Manu, 2013 WL 4768308, has made it clear that it expects strict compliance with the black letter of the Municipal Liens Act (“Act”). Defendant Agnes Manu (“Manu”), who litigated pro se, appealed an Order of the Court of Common Pleas of Philadelphia (“CCP”) denying her motion to strike or vacate and that provided the context for the Court to make its ruling and issue its opinion accordingly.

The procedural history of this matter is somewhat complex. Manu owns real estate (“Property”) in Philadelphia that is allegedly the subject of a municipal lien held by the City of Philadelphia (“City”). In January 2011 the City filed a petition with the CCP requesting permission to sell the Property free and clear of all encumbrances for delinquent water and sewer rents. The liens claimed by the City included one entered on August 27, 1987 for an unpaid water/sewer bill totaling $0.00 (no, that is not a typographical error) which was amended in its January 2011 petition to include an alleged claim of $657.54, plus interest and penalties, for City taxes allegedly owed in 1986.

In its January 2011 petition, the City identified seven (7) different parties, along with the United States, which/who allegedly have an interest in the Property based on the tax information certificate, and requested the CCP to issue a rule upon these aforesaid parties. For reasons which are unclear from the record available, the CCP issued a rule only upon Manu and directed that service should be made in the matter for writs of scire facias pursuant to the Act. The CCP granted Manu’s request for additional time to respond to the aforesaid rule, but instead of responding to the rule, Manu elected to file a motion to stay the proceedings on the basis that she had filed an appeal nunc pro tunc with the Board of Revision of Taxes due to, Manu alleged, never having received service of any tax assessment notice since 1998. Perhaps, due to the fact that Manu failed to respond to the rule, and filed a motion to stay instead, the CCP entered orders denying the motion to stay and granting the City permission to sell the Property as it requested and described above. The CCP indicated that it was satisfied that the rule was properly served and, indeed, served upon all relevant parties.

A few days after the above two (2) orders by the CCP were entered, Manu filed a motion for clarification as she could not discern whether the lien was for water/sewer bills or real estate taxes, nor was it clear how much she owed; the CCP denied this motion. Subsequent to the motion for clarification, Manu then filed a motion to strike or vacate the CCP order permitting the sale of the Property due to lack of jurisdiction based on the failure to effect proper service pursuant to the Act; this motion, too, was denied by the CCP and Manu appealed that denial. The appeal of this denial is the subject of the Commonwealth Court case described herein. While the above was transpiring, another party, namely Informational Management Group, Inc., filed a petition to intervene and open on the basis that it, too, was never properly served with the underlying lien and was not joined into the case by the City as an indispensable party; the CCP denied this petition as well.

When analyzing this matter, the Court began by emphasizing that the Act lays out a specific, detailed, and exclusive procedure which must be followed with precision. Furthermore, the Court made it clear that the City had the burden of proving strict compliance with the Act. In its review of how the CCP handled this case, the Court observed that the CCP did not even require substantial compliance with the Act, let alone strict compliance. Namely, the petition filed by the City did not provide a list of all the municipal claims at issue or a sense of their magnitude; indeed a lien which totals $0.00 is absurdly the opposite of demonstrating its magnitude, even if the City later revealed it is actually pursuing at least $14,702.99. In addition, without any explanation in the record, and at variance with the requirements of the Act, the CCP issued a rule only upon Manu instead of all interested parties and, further, none of the parties were served in the manner required by the Act. The Court noted that the Act is somewhat confusing inasmuch as one (1) section requires personal service and posting whilst another requires posting and first class mail; what was not confusing to the Court was that the record of the proceedings in CCP revealed that service was not perfected on any party using any of the above-listed options. Moreover, even if service was perfected, the Act requires the CCP to hold a hearing to determine whether service was properly perfected on all parties, whether there was contemporaneous publication of the rule, and whether the facts alleged in the petition are true. Needless to say, the CCP record contained absolutely no evidence that such a hearing was ever held. The CCP must make an independent inquiry into whether the City strictly complied with the Act and the CCP record reveals no such inquiry ever occurring.

Finally, the City attempted to argue that Manu’s appeal was untimely filed. The Court dispensed with this argument by pointing out that the CCP continued to retain jurisdiction over the Property when the sale of the same had neither occurred nor concluded. Regardless, the Court ruled that a petition to open a judgment can be filed at any time when there is a lack of subject matter jurisdiction and Manu’s claim that not all parties were served and, indeed, not all indispensable parties were joined into the case, clearly deprives the CPP of subject matter jurisdiction over the case.

In the final analysis, the Court in the instant matter made it abundantly clear that a municipality pursuing liens must strictly comply with all of the terms of the Act in order to collect on its alleged liens and Courts of Common Pleas must ensure compliance.

Originally published in Upon Further Review on October 22, 2013 and can be viewed here.

Christian Legal Clinics of Philadelphia: I Am Volunteer of the Month!

The Christian Legal Clinics of Philadelphia‘s monthly newsletter is out and, much to my surprise, I have been named Volunteer of the Month!  Although I do not really view what I do as particularly noteworthy, I am thankful, humbled, and honored by the recognition.  I hope that as the weeks and months progress, the Clinic can continue to grow and flourish in its service to those in need in the Philadelphia area.  Please continue to pray for us and donate to us your time, talents, and treasure as you feel led (if you want to give to our ministry, please see here).  Thanks to everyone who makes this vital ministry possible and thanks, above all, to God from whom all blessings flow.



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Christian Legal Clinics of Philadelphia: Banquet Bounty

God blesses those who follow his will; of this I do not and indeed cannot doubt.  The older I get the more I realize and learn that God also constantly works on his people by paring away more and more layers of one’s reliance on oneself so that ultimately one is completely reliant upon God and God alone.  I believe my experience with the Christian Legal Clinics of Philadelphia has revealed this truth to me more than ever.

I am on the Board of Directors for the Clinic and when we met in the summer 2014 we were facing very serious challenges.  First, our primary benefactor, who has enabled us to become more than just a loose collection of volunteers and turned us into what we are today, not to mention provided us with the necessary financial stability, may soon have to cut back on his support.  Second, our money reserves were running dry.  We were in danger of not making basic payroll.  We literally may not have had the money to – as the saying goes -“keep the lights on.”

We were concerned.  We were worried.  What would become of this ministry?  What was God doing?  The Clinic serves hundreds of people per year.  We are sharing the Gospel.  We are helping the poor.  We are bringing justice to those who would otherwise have to suffer injustice.  Aren’t these things God’s will?  Aren’t these things what God wants us to do?

Look again at the paragraph above.  Look at how much the word “we” is used.  Look at what “we” were doing.  Apparently, as I mentioned in the introduction above, more than anything else the Clinic needed, God needed to pare away some of our layers of self-reliance.  If you look to God’s Word, what does St. Paul have to say about this?  St. Paul says “[s]o neither he who plants nor he who waters is anything, but only God who gives the growth.  (see I Corinthians 3:7).  The Clinic is planting.  The Clinic is watering.  The Clinic is not giving the growth.  God showed us that starkly as we approached the exhaustion of our resources.  We were on the doorstep of not being able to plant or water.  Our own efforts and resources and strengths could not provide sufficient, indeed any, growth.  What were we to do?

The answer was deceptively simple: pray and rely on God, and not on ourselves, to do what he promised to do: give growth.

Over the last couple of months the Clinic held two banquets, one in Doylestown and one in Philadelphia; I wrote about the Philadelphia Banquet here.  What did God do for us?  The Doylestown banquet precisely closed our budget gap and ensured our solvency through the end of the year.  The Philadelphia banquet allowed us to meet our budget requirements two months early.  Both Banquets introduced us to many new people who just learned about the Clinic and secured more annual and periodic donors to keep a steady stream of support going for us into the future.  We made relationships that may last into the future to assist this ministry.  What else?  We may have finally made inroads to the “big firms” of Philadelphia which have been, thus far, a near impossible nut to crack for support and assistance.

God did not just met our needs; God gave growth.  God showed us that self-reliance is not what he wants.  He wants reliance on him and him alone regardless of our efforts in doing the ministry; indeed, his ministry.  We had to learn that our ministry thrives not because of what we do but because of what he does.  We received unexpected blessings that, as the Psalmist says, did not just fill our cup, but made our cup run over in ways that only God could do.

Below is the latest video presentation of our ministry.  It is an amazing piece of work given to us by the talented filmmaker Timothy Fryett.  Please check it out; you will be inspired!

If, after reading and seeing the above, you feel called to give to our ministry, please look here.  Otherwise, please pray for us and help us in any way you can so that we can continue this ministry, serve God, and bring justice and mercy to those who cannot get it through the legal system.

Thanks and God bless.

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