A confession of judgment provision in a commercial lease can be an efficient means for a commercial landlord to obtain a judgment for damages when a commercial tenant defaults on lease obligations. In representing a landlord, however, great care must be taken in determining the time frame and damages for which judgment is being sought.
As the commercial landlord in TCPF Limited Partnerships v. Skatell learned, Pennsylvania’s liberal rules concerning the amendment of pleadings aren’t so liberal when it comes to complaints for confession of judgment. It was a $138,223.54 lesson.
The confession complaint filed by TCPF sought damages for accelerated rent and associated charges for the entire unexpired balance of the lease term which, according to the warrant of attorney, was $65,196.91. Subsequent to the entry of the confessed judgment it was discovered that the damages should have been calculated as $203,420.45. Counsel attempted to remedy the discrepancy by seeking leave to file an amended complaint in confession of judgment changing the damages figure from $65,196.91 to $203,420.45. When this proved unsuccessful, counsel next sought leave to file an amended complaint to conform the $65,196.91 figure to only a certain portion of the unexpired lease term, (presumably with an eye toward filing another confession complaint to collect the remaining $138,223.54). This too proved unsuccessful.
The trial court’s rulings denying both attempts to amend were affirmed on appeal, the Superior Court finding that “[i]t is clear that, under the law of Pennsylvania, a warrant of attorney to confess judgment may not be exercised twice for the same debt.” See, TCPF Limited Partnerships v. Skatell, 976 A. 2d 571, 575 (Pa. Super. 2009). Since the warrant in this instance had been exercised purportedly for the entire unexpired balance of the lease term (albeit with improperly calculated damages), both the trial court and the Superior Court held that the warrant had been exhausted. To do otherwise, and allow TCPF to amend the confessed judgment after the fact, “would have the practical effect of giving vitality to an exhausted power.” Id.
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