J-A29019-17


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

VERTONIX, LTD.,                               IN THE SUPERIOR COURT
                                                        OF
                                                   PENNSYLVANIA
                       Appellee

                  v.

YURI AND OLGA LYUBARSKY,

                       Appellants

                  v.

THE GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA,

                       Appellee                  No. 3787 EDA 2016


                 Appeal from the Order November 8, 2016
          in the Court of Common Pleas of Philadelphia County
          Civil Division at No.: February Term, 2011 No. 03388



VERTONIX, LTD.,                               IN THE SUPERIOR COURT
                                                        OF
                                                   PENNSYLVANIA
                       Appellee

                  v.

YURI AND OLGA LYUBARSKY, H/W

                       Appellants

                  v.

THE GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA,

                       Appellee                  No. 477 EDA 2017
J-A29019-17




                Appeal from the Order Entered January 27, 2017
              in the Court of Common Pleas of Philadelphia County
              Civil Division at No.: February Term, 2011 No. 03388


    VERTONIX, LTD.,                               IN THE SUPERIOR COURT
                                                            OF
                                                       PENNSYLVANIA
                             Appellee

                        v.

    YURI AND OLGA LYUBARSKY,

                              Appellants

                        v.

    THE GUARDIAN LIFE INSURANCE
    COMPANY OF AMERICA,

                             Appellee                No. 2943 EDA 2017


                 Appeal from the Order Entered August 15, 2017
              in the Court of Common Pleas of Philadelphia County
              Civil Division at No.: February Term, 2011 No. 03388


BEFORE: LAZARUS, J., PLATT, J.,* and STRASSBURGER, J.*

MEMORANDUM BY PLATT, J.:                         FILED FEBRUARY 06, 2018

        In these consolidated appeals, Appellants, Yuri and Olga Lyubarsky,

appeal from the orders of the trial court denying their petition to strike a

confessed judgment; granting the motion of Appellee, Vertonix, Ltd. (Vertonix

____________________________________________


*   Retired Senior Judge assigned to the Superior Court.




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J-A29019-17



Ltd.), for a judgment against Appellee Garnishee, The Guardian Life Insurance

Company of America (Guardian Life); and denying Appellants’ motion for

partial summary judgment.1 We affirm.

       We take the factual and procedural history in this matter from our

review of the certified record and the trial court’s February 13, 2017, May 25,

2017, and November 21, 2017 opinions.

       On January 14, 2009, Appellants and Vertonix, Ltd. executed a

Settlement Agreement to settle a civil action that Vertonix, Ltd. filed against

Appellants in the Superior Court of New Jersey. (See Settlement Agreement

and Release, 1/14/09, at 1-3). The Settlement Agreement provided Vertonix,

Ltd. the right to confess judgment against Appellants, per the terms of an

attached Surety Agreement. (See id. at 1-2 ¶ 3; see also Surety Agreement,

1/14/09, at 1-5).       The Surety Agreement included a section concerning

confession of judgment wherein Appellants “irrevocably authorize[d] and

empowere[d] the prothonotary or clerk . . . to waive the issuance and service

of process[.]” (Surety Agreement, at 4 ¶ 7). It further provided that: “In

granting the above warrant of attorney to confess judgment, [Appellants]

hereby knowingly, intentionally, and voluntarily waive[] any and all
____________________________________________


1 On February 28, 2017, this Court sua sponte consolidated the appeal of the
trial court’s November 8, 2016 order at Docket No. 3787 EDA 2016, and the
appeal of the court’s January 27, 2017 order at Docket No. 477 EDA 2017.
On September 19, 2017, this Court granted Appellants’ application for
consolidation and continuance and consolidated their appeal of the trial court’s
August 15, 2017 order at Docket No. 2943 EDA 2017, with the appeal at
Docket Nos. 3787 EDA 2016 and 477 EDA 2017.


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constitutional rights [Appellants have] . . . either upon the confession of

judgment . . . or . . . upon execution process thereon[.]” (Id.).

       On February 24, 2011, after Appellants failed to make timely payment,

Vertonix, Ltd. confessed judgment against them for $184,264.19.         During

post-judgment discovery, Appellants filed various motions to compel and

motions for sanctions seeking to enforce their judgment.       On October 30,

2015, Appellants filed a praecipe to issue a writ of execution in attachment to

Guardian Life.      On November 18, 2015, Guardian Life filed an answer,

objections and new matter.

       On May 25, 2016, Appellants filed a motion to sustain claim for

exemption for all interest in and proceeds from four insurance policies issued

by Guardian Life; two life insurance policies and two disability insurance

policies. On July 7, 2016, the trial court denied Appellants’ motion to sustain

claim for exemption.        Appellants did not timely appeal the court’s order;

however, on May 31, 2017, they filed a motion for reconsideration, which the

court denied on June 6, 2017.

       On June 23, 2016, Appellants filed a petition to strike the confessed

judgment. The court conducted a hearing on September 21, 2016, and denied

the petition on November 8, 2016. Appellants timely appealed. 2


____________________________________________


2 The trial court did not order Appellants to file a statement of errors
complained of on appeal. It filed its opinion on February 13, 2017. See
Pa.R.A.P. 1925.


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       On December 16, 2016, Vertonix, Ltd. filed a motion for judgment

against Guardian Life seeking the proceeds or net cash surrender value of the

two individual life insurance policies that the court had deemed not subject to

exemption in the July 7, 2016 order. On January 27, 2017, the trial court

granted Vertonix, Ltd.’s motion for judgment and ordered that Guardian Life

surrender to Vertonix, Ltd. the net cash surrender value of the two life

insurance policies. Appellants timely appealed.3

       On July 11, 2017, Appellants filed a motion for partial summary

judgment arguing that the disability insurance policies were exempt from

execution. The trial court denied the motion on August 15, 2017. Appellants

timely appealed.4

       Appellants present eight questions on appeal.

       I.      Order of November 7, 2016—3787 EDA 2016

            1. Is the confessed judgment of February 24, 2011 fatally
               defective on its face and void ab initio due to the omission
               of an address from the record where original process may
               be effectuated on [Appellants]?

            2. Is the confessed judgment fatally irregular on its face where
               the complaint’s affidavit of mailing avers original process
               was sent by regular mail to “19 Shallow Brook Road
               Morganville, NJ 07751” which is inconsistent and non-
____________________________________________


3 The trial court did not order Appellants to file a statement of errors
complained of on appeal. It filed its opinion on May 25, 2017. See Pa.R.A.P.
1925.

4 Pursuant to the trial court’s order, Appellants filed a statement of errors
complained of on appeal on October 5, 2017. The trial court entered its
opinion on November 21, 2017. See Pa.R.A.P. 1925.


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J-A29019-17


              compliant with the terms of the Surety Agreement’s venue
              and exclusive jurisdiction section requiring service by
              certified mail to an address included in the agreement
              containing the confession of judgment clause?

           3. Was the trial court without jurisdiction to enter the
              confessed judgment against [Appellants] due to a failure of
              proper service of process, in violation of Pa.R.C.P. 2958.1,
              Pa.R.C.P. No. 403, and the terms of the Surety Agreement,
              where original process was sent by regular mail and to an
              address on which the agreement was entirely silent?

           4. Did the trial court err by finding waiver in that [Appellants]
              “agreed to waive all arguments with regard to due process,
              service, and their constitutional rights,” in light of the Surety
              Agreement’s language reserving service of process to
              [Appellants] by certified mail to an address contained in the
              agreement?

           5. Did the trial court improperly cite to matters dehors the
              record in footnote 5 of its opinion of February 13, 2017 and
              thereby commit reversible error when it assumed without
              any factual support in the record that “the parties all knew”
              what the service address was?

           6. Did the trial court err by ruling in its opinion “that actual
              service was not in issue” despite the issue being plainly pled
              in the petition to strike—“this effectuation of process being
              missing”—and over defense counsel’s three objections at
              oral argument that the trial court may not look to extrinsic
              evidence regarding service and must confine its inquiry to
              the record?

           7. Did the trial court fail to strictly construe and resolve any
              doubts or ambiguities regarding the validity of the judgment
              in favor of [Appellants] in accordance with the established
              rules of construction that any doubts as to the judgments’
              validity are to be resolved against the party entering such
              judgments and that a written instrument must be strictly
              construed against its maker?

     II.      Order of November 7, 2016
           8. Whether the trial court erred as a matter of law in its
              statutory interpretation and failure to apply Pennsylvania
              Supreme Court precedent by granting Vertonix, Ltd.’s

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J-A29019-17


              motion for judgment and denying [Appellants’] claim of
              immunity from execution on the life insurance policy in
              contravention of 42 Pa.C.S.[A.] § 8124(c)(6) and the
              holding of Resolute Ins. Co. v. Pennington, [224 A.2d
              757] ([Pa.] 1966)?

(Appellants’ Brief, at 3-5) (unnecessary capitalization omitted).

       Preliminarily, we note that Appellants did not file a supplemental brief

after this Court consolidated their appeal at Docket No. 2943 EDA 2017 with

the other cases in this matter. None of the questions presented in Appellants’

brief addresses the trial court’s August 15, 2017 order. (See Appellants’ Brief,

at 3-5). “No question will be considered unless it is stated in the statement

of questions involved or is fairly suggested thereby.”       Pa.R.A.P. 2116(a).

Therefore, because Appellants did not raise any issues to be resolved with

respect to the trial court’s August 15, 2017 order, they have abandoned their

appeal, and we dismiss the appeal at Docket No. 2943 EDA 2017.

       In their first issue, set forth in questions one through three,5 Appellants

argue that “the confessed judgment of February 24, 2011 is fatally flawed and

must be stricken as it contains a critical omission causing improper service

and lack of jurisdiction[.]”           (Appellants’ Brief, at 14) (unnecessary

capitalization omitted). Specifically, they argue that because the address at

which service was supposed to be made is not included in the surety

agreement, the surety agreement is fatally defective by way of omission and
____________________________________________


5 In the argument portion of their brief, Appellants offered a combined
argument for questions 1-3, 4-7, and 8. (See Appellants’ Brief, at 14-30).
Accordingly, for ease of disposition, we have similarly grouped the issues in
our discussion.


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J-A29019-17



the judgment was fatally flawed because of improper service. (See id. at 14-

23). We disagree.

     “In examining the denial of a petition to strike or open a confessed

judgment, we review the order for an abuse of discretion or error of law.”

Ferrick v. Bianchini, 69 A.3d 642, 647 (Pa. Super. 2013) (citation omitted).

          “A petition to strike a judgment is a common law proceeding
     which operates as a demurrer to the record. A petition to strike a
     judgment may be granted only for a fatal defect or irregularity
     appearing on the face of the record.” Resolution Trust Corp. v.
     Copley Qu–Wayne Associates, 546 Pa. 98, 106, 683 A.2d 269,
     273 (1996).

                  In considering the merits of a petition to strike,
           the court will be limited to a review of only the record
           as filed by the party in whose favor the warrant is
           given, i.e., the complaint and the documents which
           contain confession of judgment clauses.          Matters
           dehors the record filed by the party in whose favor the
           warrant is given will not be considered. If the record
           is self-sustaining, the judgment will not be stricken. .
           . . An order of the court striking a judgment annuls
           the original judgment and the parties are left as if no
           judgment had been entered.

     Hazer v. Zabala, 26 A.3d 1166, 1169 (Pa. Super. 2011) (quoting
     Resolution Trust Corp., supra). In other words, the petition to
     strike a confessed judgment must focus on any defects or
     irregularities appearing on the face of the record, as filed by the
     party in whose favor the warrant was given, which affect the
     validity of the judgment and entitle the petitioner to relief as a
     matter of law. [See] ESB Bank v. McDade, 2 A.3d 1236, 1239
     (Pa. Super. 2010). “[T]he record must be sufficient to sustain the
     judgment.” Id. The original record that is subject to review in a
     motion to strike a confessed judgment consists of the complaint
     in confession of judgment and the attached exhibits. Resolution
     Trust Corp., supra at 108, 683 A.2d at 274.




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J-A29019-17



Midwest Fin. Acceptance Corp. v. Lopez, 78 A.3d 614, 622–23 (Pa. Super.

2013).

      Here, Appellants contend that the trial court should have stricken the

confessed judgment as fatally defective because the Surety Agreement does

not set forth an address where process may be effectuated. (See Appellants’

Brief, at 15). The provision at issue in the Surety Agreement states:

      Surety waives personal service of the summons, complaint and
      any other process issued in any such action or suit and agrees
      that service of such summons, complaint, and any other process
      may be made by registered or certified mail, postage prepaid,
      addressed to the Surety at the address set forth below and that
      service so made shall be deemed completed upon the providing of
      such notice. . . .

(Surety Agreement, at 3 ¶ 4). Consistent with Appellants’ claim, the Surety

Agreement does not contain an “address set forth below[.]” (Id.).

      However, the trial court found that there was not any fatal defect, which

would have mandated striking the judgment, and that Appellants waived any

challenge to improper service. (See Trial Court Opinion, 2/13/17, at 4). It

explained that “[t]he record indicates that [Appellants] signed a Settlement

Agreement and Release, a Surety Agreement, and a Disclosure and Waiver of

Rights Regarding Confession of Judgment, in which they agreed to waive all

arguments with regard to due process, service, and their constitutional

rights.” (Id.).

      Upon review, we conclude that the trial court did not abuse its discretion

when it denied Appellants’ petition to strike the confessed judgment.

Appellants’ argument that, although service was waived, the Surety

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J-A29019-17



Agreement lacked an address at which service may be effectuated, does not

prove a fatal defect. Furthermore, we agree that the Surety Agreement is

clear that Appellants waived all arguments with regard to service.            (See

Surety Agreement, at 3 ¶ 4, 4 ¶ 7). Appellants did not meet their burden of

showing that the trial court abused its discretion. See Ferrick, supra at 647.

Appellants’ first issue (as set forth in questions one through three) does not

merit relief.

       In their next issue (set forth in questions four through seven),

Appellants claim that “the petition to strike was properly pled, and it was error

for the trial court to find waiver of [Appellants’] right to service as specified in

the agreement and waiver of the argument of improper service and failure to

apply established rules of construction[.]”          (Appellants’ Brief, at 23)

(unnecessary capitalization omitted). Appellants contend that the trial court

erred when it found waiver because it did not resolve in their favor any doubts,

ambiguities, and irregularities in the record. (See id. at 25). We disagree.

       As discussed, we review the denial of a petition to strike a confessed

judgment for an abuse of discretion or error of law. See Ferrick, supra at

647.

       It is a firmly established rule of construction in the case of
       warrants of attorney to confess judgments that the authority thus
       given must be clear, explicit and strictly construed, that if doubt
       exists it must be resolved against the party in whose favor the
       warrant is given, and that all proceedings thereunder must be
       within the strict letter of the warrant. . . .




                                      - 10 -
J-A29019-17



Dime Bank v. Andrews, 115 A.3d 358, 364 (Pa. Super. 2015) (citation

omitted).

       Here, the Surety Agreement is clear and unambiguous that Appellants

“irrevocably authorize[] . . . any attorney of any court of record to waive the

issuance and service of process and . . . confess judgment . . . against” them.

(Surety Agreement, at 4 ¶ 7; see also id. (waiving all constitutional rights

upon confession of judgment or execution process); id. at 2 ¶ 2(a) (waiving

notice); id. at 3 ¶ 4 (waiving personal service of summons and complaint)).

Furthermore, the Settlement Agreement provides that it “shall be deemed as

having been jointly drafted by the parties and shall not be construed in favor

or against either of the parties, but will be given its plain meaning.”

(Settlement Agreement, at 2 ¶ 8).

       Therefore, we conclude that the trial court did not abuse its discretion

when it interpreted the plain meaning of the Surety Agreement and concluded

that Appellants waived their right to service. See Ferrick, supra at 647.

Appellants’ second issue (questions four through seven) does not merit relief.

       Lastly, in their final issue, Appellants claim that the trial court erred

when it ruled that Guardian Life must surrender the cash value of two life

insurance policies.6 (See Appellants’ Brief, at 25-30). They contend that the

____________________________________________


6 In addition to denying exemption for the life insurance policies, the court
denied Appellants’ claimed exemption for two disability insurance policies. In
their brief, Appellants did not raise the issue of whether the disability policies
are exempt. (See Appellants’ Brief, at 8, 13, 25-30). Therefore, Appellants
have waived that claim. See Pa.R.A.P. 2101, 2116(a), 2119(a)-(c).

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J-A29019-17



policies are exempt under 42 Pa.C.S.A. § 8124(c)(6), because Appellant Olga

Lyubarsky, the spouse of the insured, is the beneficiary of the policy. (See

id. at 26, 29). We disagree.

     Appellants claim that the trial court erred in its interpretation of Section

8124(c)(6). Because this presents a purely legal question, our standard of

review is de novo and our scope of review is plenary. See Allstate Life Ins.

Co. v. Com., 52 A.3d 1077, 1080 (Pa. 2012).

           The General Assembly has directed in the Statutory
     Construction Act, 1 Pa.C.S.[A.] § 1501 et seq., that the object of
     interpretation and construction of all statutes is to ascertain and
     effectuate the intention of the General Assembly. Generally
     speaking, the best indication of legislative intent is the plain
     language of a statute. Furthermore, in construing statutory
     language, “[w]ords and phrases shall be construed according to
     rules of grammar and according to their common and approved
     usage . . . .” 1 Pa.C.S.[A.] § 1903. . . .

Rodgers v. Lorenz, 25 A.3d 1229, 1231 (Pa. Super. 2011) (case citation

omitted).

     Section 8124(c)(6) states:

     (c) Insurance proceeds.—The following property or other rights
     of the judgment debtor shall be exempt from attachment or
     execution on a judgment:

            (6) The net amount payable under any annuity
            contract or policy of life insurance made for the benefit
            of or assigned to the spouse, children or dependent
            relative of the insured, whether or not the right to
            change the named beneficiary is reserved by or
            permitted to the insured. The preceding sentence
            shall not be applicable to the extent the
            judgment debtor is such spouse, child or other
            relative.



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J-A29019-17



42 Pa.C.S.A. § 8124(c)(6) (emphasis added).

       Here, Appellant Olga Lyubarsky is both the beneficiary of Appellant Yuri

Lyubarsky’s life insurance policies, and also a judgment debtor. (See Motion

to Sustain Claim for Exemption, 5/25/16, at 1). Therefore, based upon the

plain meaning of the statute, we conclude that the trial court did not err when

it found that the life insurance policies were not exempt pursuant to Section

8124(c)(6). Appellants’ final issue does not merit relief.7

       Orders affirmed. Appeal at Docket 2943 EDA 2017 dismissed.




____________________________________________


7 Furthermore, although Appellants argue that the final sentence should not
apply because their children are named beneficiaries on the policy as well as
Appellant Olga Lyubarsky, (see Appellants’ Brief, at 28-30), Appellants base
their argument on Resolute Ins. Co., supra, which relied on the language
of 40 P.S. § 517. Section 517 was the predecessor to section 8124(c), and
did not include the sentence concerning judgment debtor beneficiaries.
Therefore, we decline to apply its holding in the instant case. Additionally, we
note that Appellants’ children are contingent beneficiaries under the policy
whose rights do not arise until the death of the primary beneficiary, Appellant
Olga Lyubarsky. (See Trial Ct. Op., 5/25/17, at 3-4). Finally, Appellants’
motion to sustain claim for exemption only argues that the policies are exempt
because Appellant Olga Lyubarsky is the beneficiary; it does not mention the
children. (See Motion for Exemption, at 1-2). “Issues not raised in the lower
court are waived and cannot be raised for the first time on appeal.” Pa.R.A.P.
302(a).


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J-A29019-17




Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date:2/6/18




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