"Where a party fails to appear at a scheduled hearing, the Board may remand the case for an additional hearing only where the Board has made an independent determination that the reasons set forth by the party for its failure to appear constitute proper cause." Sanders v. UCBR, 524 A.2d 1031, 1032 (Pa. Cmwlth. 1987) (emphasis added); see also 34 Pa. Code §101.24.
Under Rule 101.24, "[i]f a party fails to appear at a scheduled hearing, that party must show good cause for that failure before the Board will delay the final disposition of the case by remanding for additional hearings." McNeill v. UCBR, 510 Pa. 574, 579, 511 A.2d 167, 169 (1986).
If the evidence in the record supports that a notice from the Board was mailed to a party’s last known address and not returned as undeliverable by the Post Office, it is presumed that the notice was received. See Gaskins v. UCBR, 429 A.2d 138 (Pa. Cmwlth. 1981) (affirming the Board’s denial of an untimely appeal where notice of the referee’s decision was mailed, was not returned by the postal authorities, and contained the information necessary to put the claimant on notice of the referee’s decision). This presumption is rebuttable. Id.
However, the mere assertion that the notice was not received, without factual support of any kind, is insufficient to rebut this presumption and does not constitute “good cause” for not appearing at a hearing. Otherwise, there would be no incentive to appear at the initial hearing. See McNeill. See also Wheeler v. Red Rose Transit Authority, 890 A.2d 1228, 1231 (Pa. Cmwlth 2006) (“testimony alone” that a notice from the court was not received will not rebut the presumption under Pa. R.C.P. No. 440(b) that notice was received); Kulick v. Commonwealth, 666 A.2d 1148 (Pa. Cmwlth. 1995) (testimony that a third party interfered with receipt of mail does not satisfy the burden of proving mail was not received); Sheehan v. WCAB, 600 A.2d 633 (Pa. Cmwlth. 1991) (testimony denying receipt is insufficient, in and of itself, to rebut the presumption that a properly-mailed item was received); Commonwealth v. Warenczuk, 636 A.2d 1225, 1226 (Pa. Cmwlth. 1991) (presumption that notice of a license suspension was received is not rebutted by “mere denial of receipt”).
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The opinion, though not reported, may be cited "for its persuasive value, but not as binding precedent." 210 Pa. Code § 67.55. Citing Judicial Opinions.
Rule 237.5 requires that the 10-Day Notice "be substantially in the following form":
YOU ARE IN DEFAULT BECAUSE YOU HAVE FAILED TO ENTER A WRITTEN APPEARANCE PERSONALLY OR BY ATTORNEY AND FILE IN WRITING WITH THE COURT YOUR DEFENSES OR OBJECTIONS TO THE CLAIMS SET FORTH AGAINST YOU. UNLESS YOU ACT WITHIN TEN DAYS FROM THE DATE OF THIS NOTICE, A JUDGMENT MAY BE ENTERED AGAINST YOU WITHOUT A HEARING AND YOU MAY LOSE YOUR PROPERTY OR OTHER IMPORTANT RIGHTS. Pa. R.C.P. No. 237.5 (emphasis added).
The Plaintiff's 10-Day Notice to Defendant provided:
You are in default because you have failed to take action required of you in this case. Unless you act within ten (10) days from the date of this notice, a Judgment may be entered against you without a hearing and you may lose your property or other important rights. . . . (emphasis added).)
The Plaintiff's notice is not identical to the Rule 237.5 form. Rather than instructing Defendant specifically of what he failed to do that led the Plaintiff to issue the notice, as the Rule 237.5 form provides, the Plaintiff's's notice only informed Defendant that he was in default because he "failed to take action required of [him] in this case."
In light of this apparent inconsistency on the face of the record, our analysis must proceed as follows: (a) did the Plaintiff's notice comply with Rule 237.5 because, though not identical, it was "substantially" in the form required by the rule, and, if not, (b) is it a fatal defect such that the default judgment must be set aside.
Held,
a) The notice was not "substantially in the form" required by the rules of procedure - Under the prior version of Rule 237.5, the notice only had to inform defendant that it he was in default, notify the defendant that the plaintiff intends to seek a default judgment if action is not taken within ten (10) days, and include some indicia of notice to legal counsel for the defendant, if represented. But with the 2004 amendment, Rule 237.5 now imposes an additional notice requirement on a plaintiff who wishes to obtain a judgment by default—i.e., the plaintiff must now include in the 10-Day Notice specific reasons why the defendant is in default. It is this additional notice that is absent in any form from the Plaintiff's's 10-Day Notice. Without this additional notice component, required by the Pennsylvania Rules of Civil Procedure for over five (5) years before the Plaintiff filed its complaint, we cannot consider the City’s notice to be "substantially" in the form required by Rule 237.5. The City, therefore, failed to comply with Rule 237.5 and, consequently, Rule 237.1(a)(2) of the Pennsylvania Rules of Civil Procedure.
b) The defect was fatal to the case, in which the judgment must be stricken - A default judgment entered where there has not been strict compliance with the rules of civil procedure is void." Franklin Interiors, Inc. v. Browns Lane, Inc., 323 A.2d 226, 228 (Pa. Super. 1974). Rules allowing a party to obtain a judgment by filing a praecipe, whether for non pros or by default for failure to plead, must be strictly construed. The 10-Day Notice required by Rule 237.1 in this case was defective on its face, as it was not "substantially" in the form required by Rule 237.5. Rather, the notice was based on the Old Form Notice, which the Pennsylvania Supreme Court amended to include the very language that the City omitted from its notice in this case—language that the Supreme Court added for a specific reason. Erie Ins. Co. v. Bullard, 839 A.2d 383, 387 (Pa. Super. 2003). Failure to include this key language was, therefore, a fatal defect. Regardless of the level of actual notice Defendant had, he did not have the type and extent of notice that the Pennsylvania Supreme Court required the City to provide before obtaining a default judgment.
However, in this case, there was no sufficient proof of such conduct. Employer's evidence consists solely of testimony was based upon phone records that were never introduced into evidence. Although Claimant did not raise a hearsay objection, under the legal residuum rule, hearsay evidence admitted without objection will be given its natural probative effect only if it is corroborated by any competent evidence in the record.‟" Greer v. UCBR, 4 A.3d 733, 737 n.7 (Pa. Cmwlth. 2010) (quoting Walker v. UCBR, 367 A.2d 366, 370 (Pa. Cmwlth. 1976)). Here, there is no such corroboration in the record. Claimant did not admit to any wrongdoing and the employer witness did not testify from her own observation and knowledge.
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The opinion, though not reported, may be cited "for its persuasive value, but not as binding precedent." 210 Pa. Code § 67.55. Citing Judicial Opinions.
The doctrine of nullum tempus occurrit regi generally provides that statutes of limitations do not bar actions brought by a state or its agencies. „Under the doctrine of nullum tempus, statutes of limitations are not applicable to actions brought by the Commonwealth or its agencies unless a statute expressly so provides.‟
929 A.2d 1258, 1261 (Pa. Cmwlth. 2007) (quoting City of Phila. v. Lead Indus. Ass’n, Inc., 994 F.2d 112, 118 (3d Cir. 1993)).
The Board granted UC benefits on the basis that a substantial reduction would have occurred to Claimant’s pension benefits had he not voluntarily resigned.
Because we conclude that the projections about Claimant’s future pension benefits were speculative, we reverse.
In order for the doctrine of res judicata to apply four conditions must concur:
(1) identity of the thing sued upon or for;
(2) identity of the cause of action;
(3) identity of the persons and parties to the action; and
(4) identity of the quality or capacity of the parties.
Stevenson v. Silverman, 417 Pa. 187, 190, 208 A.2d 786, 787-788 (1965); Swift v. Radnor Township, 983 A.2d 227, 232 (Pa. Cmwlth. 2009).
Generally, a cause of action will be considered identical when the subject matter and the ultimate issues are the same in both proceedings. Swift, 983 A.2d at 232.
Finally, it is well-settled that res judicata will not be "defeated by minor differences of form, parties, or allegations, when these are contrived only to obscure the real purpose, -- a second trial on the same cause between the same parties." Stevenson, 417 Pa. at 192, 208 A.2d at 788 (quoting Hochman v. Mortgage Finance Corporation of Pennsylvania, 289 Pa. 260, 263, 137 A. 252, 253 (1927)).
Res judicata bars all causes of action that were either raised or could have been raised during a prior proceeding. R/S Financial Corp., 552 Pa. at 588, 716 A.2d at 1230 (emphasis added).
In this Ch. 13 proceeding, the court upheld the bankruptcy court's imposition of sanctions on a creditor's attorney and law firm and the creditor, HSBC, for filing a proof of claim in a Ch. 13 proceeding without adequately determining if the allegations in their filings had "evidentiary support." In that they did not, the court stated "the attorney essentially abdicated her professional judgment to a black box." [emphasis added]
This case is an unfortunate example of the ways in which overreliance on computerized processes in a high-volume practice, as well as a failure on the part of clients and lawyers alike to take responsibility for accurate knowledge of a case, can lead to attorney misconduct before a court.
In the debtors' bankruptcy petition, they listed the bank HSBC, which held the mortgage on their house, as a creditor. In turn, HSBC filed a proof of claim with the bankruptcy court.
HSBC attorneys filed two pleadings in the bankruptcy court—(1) the request for relief from the automatic stay which would have permitted HSBC to pursue foreclosure proceedings despite the Taylors‟ bankruptcy filing and (2) the response to the debtors' objection to HSBC‟s proof of claim.
HSBC retained the Udren Firm to seek relief from the stay. Mr. Udren is the only partner of the Udren Firm; Ms. Doyle, who appeared for the Udren Firm in the case, is a managing attorney at the firm, with twenty-seven years of experience. HSBC does not deign to communicate directly with the firms it employs in its high-volume foreclosure work; rather, it uses a computerized system called NewTrak (provided by a third party, LPS) to assign individual firms discrete assignments and provide the limited data the system deems relevant to each assignment. The firms are selected and the instructions generated without any direct human involvement. The firms so chosen generally do not have the capacity to check the data (such as the amount of mortgage payment or time in arrears) provided to them by NewTrak and are not expected to communicate with other firms that may have done related work on the matter. Although it is technically possible for a firm hired through NewTrak to contact HSBC to discuss the matter on which it has been retained, it is clear from the record that this was discouraged and that some attorneys, including at least one Udren Firm attorney, did not believe it to be permitted. In this case, NewTrak provided the Udren Firm with only the loan number, the debtors' name and address, payment amounts, late fees, and amounts past due. It did not provide any correspondence with the Taylors concerning a dispute about the debtors' liability to HSBC for flood insurance payments and coverage that HSBC procured over the debtors' objection.
The law firm filed requests for admissions (RFAs), to which the debtors did not respond. Even so, the bankruptcy court denied the request to enter the RFAs as evidence, noting that the firm "closed their eyes to the fact that there was evidence that . . . conflicted with the very admissions that they asked me [to deem admitted]. They . . . had that evidence [that the assertions in its motion were not accurate] in [their] possession and [they] went ahead like [they] never saw it." . . . The court noted: Maybe they have somebody there churning out these motions that doesn‟t talk to the people that—you know, you never see the records, do you? Somebody sends it to you that sent it from somebody else. . . . "I really find this motion to be in questionable good faith," the court concluded.
Rule 9011 of the Federal Rules of Bankruptcy Procedure, the equivalent of Rule 11 of the Federal Rules of Civil Procedure, requires that parties making representations to the court certify that "the allegations and other factual contentions have evidentiary support or, if specifically so identified, are likely to have evidentiary support." Fed. R. Bank. P. 9011(b)(3).12 A party must reach this conclusion based on "inquiry reasonable under the circumstances." Fed. R. Bank. P. 9011(b). The concern of Rule 9011 is not the truth or falsity of the representation in itself, but rather whether the party making the representation reasonably believed it at the time to have evidentiary support. In determining whether a party has violated Rule 9011, the court need not find that a party who makes a false representation to the court acted in bad faith. "The imposition of Rule 11 sanctions . . . requires only a showing of objectively unreasonable conduct." [citations omitted] While Rule 9011 "does not recognize a „pure heart and empty head‟ defense,". . . a lawyer need not routinely assume the duplicity or gross incompetence of her client in order to meet the requirements of Rule 9011. It is therefore usually reasonable for a lawyer to rely on information provided by a client, especially where that information is superficially plausible and the client provides its own records which appear to confirm the information.
However, the attorney's behavior was unreasonable, both as a matter of her general practice and in ways specific to this case. First, reasonable reliance on a client's representations assumes a reasonable attempt at eliciting them by the attorney. That is, an attorney must, in her independent professional judgment, make a reasonable effort to determine what facts are likely to be relevant to a particular court filing and to seek those facts from the client. She cannot simply settle for the information her client determines in advance—by means of an automated system, no less—that she should be provided with. Yet that is precisely what happened here.
The attorney;'s reliance on HSBC was particularly problematic because she was not, in fact, relying directly on HSBC. Instead, she relied on a computer system run by a third-party vendor. She did not know where the data provided by NewTrak came from. She had no capacity to check the data against the original documents if any of it seemed implausible. And she effectively could not question the data with HSBC. In her relationship with HSBC, the attorney essentially abdicated her professional judgment to a black box. [emphasis added]
We appreciate that the use of technology can save both litigants and attorneys time and money, and we do not, of course, mean to suggest that the use of databases or even certain automated communications between counsel and client are presumptively unreasonable. However, Rule 11 requires more than a rubber-stamping of the results of an automated process by a person who happens to be a lawyer. Where a lawyer systematically fails to take any responsibility for seeking adequate information from her client, makes representations without any factual basis because they are included in a "form pleading" she has been trained to fill out, and ignores obvious indications that her information may be incorrect, she cannot be said to have made reasonable inquiry. Therefore, we find that the bankruptcy court did not abuse its discretion in imposing sanctions on the creditor's attorney and law firm.
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(a) Rules 1023.1 through 1023.4 do not apply to disclosures and discovery requests, responses, objections and discovery motions that are subject to the provisions of general rules.
(b) Every pleading, written motion, and other paper directed to the court shall be signed by at least one attorney of record in the attorney’s individual name, or, if the party is not represented by an attorney, shall be signed by the party. This rule shall not be construed to suspend or modify the provisions of Rule 1024 or Rule 1029(e).
(c) The signature of an attorney or pro se party constitutes a certificate that the signatory has read the pleading, motion, or other paper. By signing, filing, submitting, or later advocating such a document, the attorney or pro se party certifies that, to the best of that person’s knowledge, information and belief, formed after an inquiry reasonable under the circumstances,
(1) it is not being presented for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation,
(2) the claims, defenses, and other legal contentions therein are warranted by existing law or by a nonfrivolous argument for the extension, modification or reversal of existing law or the establishment of new law,
(3) the factual allegations have evidentiary support or, if specifically so identified, are likely to have evidentiary support after a reasonable opportunity for further investigation or discovery; and
(4) the denials of factual allegations are warranted on the evidence or, if specifically so identified, are reasonably based on a lack of information or belief.
[emphasis added]
(d) If, after notice and a reasonable opportunity to respond, the court determines that subdivision (c) has been violated, the court may, subject to the conditions stated in Rules 1023.2 through 1023.4, impose an appropriate sanction upon any attorneys, law firms and parties that have violated subdivision (c) or are responsible for the violation.
The UCBR may consider an untimely appeal on a nunc pro tunc basis. UCBR v. Hart, 348 A.2d 497, 498 (Pa. Cmwlth. 1975). The burden to establish the right to nunc pro tunc relief is a heavy one because the statutory time limit established for appeals is mandatory. Blast Intermediate Unit No. 17 v. UCBR, 645 A.2d 447, 449 (Pa. Cmwlth. 1994). An appellant may satisfy this heavy burden by showing: (1) fraudulent, wrongful or negligent conduct on the part of the administrative agency; or (2) non-negligent conduct beyond the appellant’s control that caused the delay. Bass v. Commonwealth, 485 Pa. 256, 259-260, 401 A.2d 1133, 1135 (1979).