## Facts

- A manufacturing company discovered that its assistant controller, Robert J. Rawlinson, Jr., had embezzled $327,011.22 over about 21 months.
- After discovery and Robert’s admission, a company/insurance representative contacted Robert and his wife, Joan Rawlinson, at their home.
- Joan had no employment relationship with the company and learned of the embezzlement and Robert’s termination only shortly before the representative’s visit.
- The representative obtained signatures from Robert and Joan on two judgment notes authorizing confession of judgment:
  - A first note for $160,000.
  - A second note signed with the amount left blank to be completed later; it was later filled in as $212,113.21 based on an affidavit, including more than $45,000 in interest.
- The trial court found Joan was not told the total amount misappropriated, was not given a meaningful explanation of the second note’s effect or the interest calculation, and believed the first note effectively satisfied any obligation.
- The representative indicated the company was not interested in pursuing criminal prosecution if the Rawlinsons cooperated.
- The company entered confessed judgment against Joan on the second note for $212,113.21.
- Joan promptly petitioned to open the confessed judgment, asserting fraud/misrepresentation, duress, and lack of accountability for the amount.
- The Court of Common Pleas opened the judgment as to Joan; the company appealed.

## Issues

1. Whether the trial court abused its discretion in opening the confessed judgment based on Joan’s evidence of a prima facie defense.
2. Whether Joan presented a meritorious defense that her assent to the second judgment note was induced by fraudulent or material misrepresentation.
3. Whether the circumstances, including implied linkage to criminal prosecution and Joan’s condition and lack of information, supported duress sufficient to render her assent voidable.
4. Whether the transaction was unconscionable due to unequal bargaining power and lack of meaningful choice and understanding.
5. Whether the opaque later completion of the second note’s amount supported opening the judgment.

## Decision

- The Superior Court affirmed the order opening the confessed judgment against Joan.
- The court held the trial court did not abuse its discretion in finding Joan presented evidence that would require submission of her defenses to a factfinder.
- The record supported prima facie defenses of fraudulent/material misrepresentation, duress, and unconscionability regarding Joan’s execution of the second note.
- The later completion of the second note’s amount without a contemporaneous explanation to Joan reinforced the defenses.

## Legal Principles

- A confessed judgment may be opened when the defendant acts promptly and presents evidence that, if believed, would require submission of the issues to a jury; appellate review is for abuse of discretion.
- Assent induced by a fraudulent or material misrepresentation makes an instrument voidable, particularly where the misled party reasonably relies and lacks a fair ability to verify material terms.
- Duress may render assent voidable when a party’s will is overborne by improper pressure, including implied threats tied to criminal prosecution.
- A contract may be unconscionable where there is unequal bargaining power and the weaker party lacks meaningful choice and does not provide informed, voluntary consent.
- Lack of transparency about a material term—such as leaving an amount blank to be filled in later, with interest added and no adequate explanation—can support findings of misrepresentation and unconscionability sufficient to open a confessed judgment.

## Conclusion

The court affirmed opening the confessed judgment because Joan produced sufficient evidence that her signature on the second judgment note was obtained through material misrepresentations, coercive pressure linked to potential prosecution, and unfair circumstances reflecting unequal bargaining power and inadequate disclosure of the obligation’s true scope.


Germantown Manufacturing Co. v. Rawlinson, 341 Pa. Super. 42, 491 A.2d 138 (Pa. Super. Ct. 1985)