J-S17001-22

2022 PA Super 123

OBARA REALTY GROUP, LLC

v.

ATLAS REAL ESTATE INVESTMENTS, 

LLC AND ROBERT GORRA

APPEAL OF: ROBERT GORRA

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 IN THE SUPERIOR COURT OF

 PENNSYLVANIA

 No. 2630 EDA 2021

Appeal from the Order Entered November 17, 2021

In the Court of Common Pleas of Philadelphia County Civil Division at 

No(s): Aug. Term, 2021 No. 01984

OBARA REALTY GROUP, LLC

v.

ATLAS REAL ESTATE INVESTMENTS, 

LLC AND ROBERT GORRA

APPEAL OF: ATLAS REAL ESTATE 

INVESTMENTS, LLC

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 IN THE SUPERIOR COURT OF

 PENNSYLVANIA

 No. 2631 EDA 2021

Appeal from the Order Entered November 17, 2021

In the Court of Common Pleas of Philadelphia County Civil Division at 

No(s): Aug. Term, 2021 No. 01984

BEFORE: BOWES, J., LAZARUS, J., and STABILE, J.

OPINION BY BOWES, J.: FILED JULY 19, 2022

These appeals stem from a confession of judgment filed by Obara Realty 

Group, LLC (“Obara”) against Atlas Real Estate Investments, LLC (“Atlas”) and 

Robert Gorra (“Mr. Gorra”) (collectively, “Defendants”). Atlas appeals from 
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the November 17, 2021 order denying its petition to open and/or strike the 

judgment by confession. Mr. Gorra appeals from the same order, which 

denied his petition for costs and fees.1 We affirm the portion of the order 

denying Atlas’s petition, vacate the portion of the order denying Mr. Gorra’s

petition, and remand with instructions.

We glean the following facts and procedural history from the certified

record. On January 12, 2021, Atlas executed a Term Note for the principal 

sum of $121,284, with Obara as the lender and repayment due no later than 

the maturation date of July 31, 2021. The loan was associated with a plan to 

rehabilitate and sell real property in Philadelphia. Mr. Gorra signed the Term 

Note and a Guaranty of Payment on behalf of Atlas. Obara made a partial 

disbursement to Atlas in the amount of $46,504. Atlas did not make any 

repayment at the time the Term Note matured and Obara filed a complaint in 

confession of judgment against Atlas and Mr. Gorra for the amount disbursed 

plus interest and attorney’s fees. Obara subsequently filed a praecipe to 

vacate the judgment against Mr. Gorra. 

Thereafter, Atlas and Mr. Gorra filed a joint petition. Atlas sought to 

open and/or strike the judgment based on the arguments that a condition 

precedent had not been satisfied and Obara had failed to aver a default, Obara 

confessed judgment for an indeterminate amount that was subject to open 

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1 These appeals were consolidated by stipulation of the parties. See Pa.R.A.P. 

513. Defendants, who are represented by the same attorney, filed a joint 

brief and reply brief.
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arbitration proceedings, Obara incorrectly set the interest rate, and the 

agreement did not support Obara’s claim for attorney’s fees. Mr. Gorra sought 

reimbursement of costs and fees for being incorrectly identified as a defendant 

in the confession of judgment action. Obara filed a response in opposition. 

In Atlas’s sur-reply, it further argued that “failure of consideration preclude[d] 

enforcement of the confessed judgment” because Atlas never received the full 

principal sum. Sur-reply in Support of Petition to Open and/or Strike 

Confessed Judgment, 10/29/21, at 1 (emphasis omitted). 

The trial court denied Atlas’s petition because it found the sale of the 

property was not a condition precedent to payment and there was a “sum 

certain that is outstanding and due.” Order, 11/17/21, at 1 n.1. The court 

denied without prejudice Mr. Gorra’s motion on the basis that the relief sought 

was a function of the Office of Judicial Records, not the trial court. Id.

These timely filed appeals followed. Defendants and the trial court have 

complied with Pa.R.A.P. 1925. Defendants present two issues for our review:

1. Where the record submitted by [Obara] in support of a 

confession of judgment states that [Obara] failed to deliver the 

consideration ($121,284) to [Atlas] in exchange for [Atlas’s] 

agreement to a confession of judgment provision in their 

contract, does that satisfy the standard for striking and/or 

opening a confessed judgment for failure of consideration?

2. In a matter of first impression, under 42 Pa.C.S. § 2737.1 

(“Incorrect Debtor Identified”), where a debtor has been

incorrectly identified and had a confession of judgment entered 

against him, shall the trial court award “costs and reasonable 

attorney fees as determined by the court,” instead of the Office 

of Judicial Records?
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Defendants’ brief at 3.2

We review an order denying a petition to strike or open a confessed 

judgment for an abuse of discretion, as follows:

A confessed judgment will be stricken only if a fatal defect or 

irregularity appears on the face of the record. A judgment by 

confession will be opened if the petitioner acts promptly, alleges 

a meritorious defense, and presents sufficient evidence in support 

of the defense to require the submission of the issues to a jury. In 

adjudicating the petition to strike and/or open the confessed 

judgment, the trial court is charged with determining whether the 

petitioner presented sufficient evidence of a meritorious defense 

to require submission of that issue to a jury. A meritorious 

defense is one upon which relief could be afforded if proven at 

trial.

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

Atlas presents two arguments in support of its contention that the trial 

court erred in denying its petition to open or strike the confessed judgment. 

First, it contends that Obara “failed to perform their obligation to deliver 

payment of the ‘principal sum’ of $121,284 to [Atlas] in January 2021 as 

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In the argument section of their brief, Defendants also argue that the trial 

court erred in failing to find an agreement to arbitrate. See Defendants’ brief 

at 12-20. Although the trial court addressed this argument in a footnote, see 

Trial Court Opinion, 1/31/22, at 8 n.30, Defendants did not preserve this claim 

in their Rule 1925(b) statement or in the statement of questions in their 

appellate brief. Accordingly, it is waived. See Pa.R.A.P. 1925(b); Pa.R.A.P. 

2116(a). Even if not waived, we would affirm on the identical basis expressed 

by the trial court. See Trial Court Opinion, 1/31/22, at 8 n.30 (finding that 

Atlas’s agreement to arbitrate in a separate contract with a separate entity to 

which Obara was not a party was insufficient to create a meritorious defense, 

despite Obara’s managing partner also being one of the owners of the separate 

entity, as the Term Note did not contain an arbitration provision and did not

merge with the other contract containing the arbitration provision).
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specified in their Term Note” and that this “constitutes a failure of 

consideration that precludes enforcement of the confession of judgment 

provisions of the Term Note.” Defendants’ brief at 12.

Failure of consideration “goes to the heart of any claim based on an 

agreement and is always available as a defense to that claim.” McGuire v. 

Schneider, Inc., 534 A.2d 115, 118 (Pa.Super. 1987) (citation omitted). 

Thus, Atlas alleged a meritorious defense. See M.N.C. Corp. v. Mount 

Lebanon Medical Center Inc., 509 A.2d 1256, 1259 (Pa. 1986). 

Nonetheless, the trial court denied Atlas’s petition to open the judgment based 

on a finding that Atlas did not present sufficient evidence to warrant 

submitting the defense to a jury:

[Obara] disbursed $46,504 of the principal sum to Atlas on or 

before the maturity date. Once the Term Note matured, payment 

was due. The $46,504 disbursed was the consideration for the 

Term Note notwithstanding the fact that monies remained 

available for disbursement. [Obara] did not confess judgment on 

the entire principal sum made available for Atlas’[s] use. [Obara] 

only confessed judgment on the unpaid balance of the principal 

indebtedness due on the maturity date of the loan. It is clear from 

the Term Note that the parties contemplated a situation wherein 

the entire principal sum would not be distributed.

Trial Court Opinion, 1/31/22, at 7 (footnote omitted). 

In its complaint, Obara averred that although it had reserved the entire 

principal amount for Atlas, it had disbursed $46,504 and, with interest and 

attorney’s fees, Atlas owed Obara repayment in the amount of $56,672.65. 

Complaint, 8/23/21, at 2-3. Atlas does not challenge the accuracy of this 

partial disbursement. Instead, it bases its defense solely on Obara’s failure to 
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disburse the entire principal sum. In other words, Atlas contends that its 

obligation to pay Obara was contingent upon receipt of the full principal sum. 

Upon review of the certified record, the Term Note supports the trial 

court’s conclusion that the parties bargained for the potential that only a 

portion of the principal sum would be disbursed and that the amount actually 

disbursed, whether the entire principal sum or a portion thereof, would be 

payable and due no later than July 31, 2021. Paragraph two of the Term Note 

provides for payment in pertinent part as follows: 

[Atlas] shall pay the entire principal sum hereunder upon sale of 

their property . . . together with [Obara’s] pro rata share of free 

cash flow available no later than July 31, 2021. [Obara’s] pro rata 

share is defined as total loan proceeds actually disbursed by 

[Obara] divided by total cash invested into the property by both 

[Atlas’s] equity and [Obara’s] loan disbursements[.]

Term Note, 1/12/21, at ¶ 2 (emphasis in original). Obara disbursed $46,504 

of the principal sum and, under the plain language of the Term Note, payment 

of that actual disbursement amount was due no later than July 31, 2021. 

Accordingly, the trial court did not abuse its discretion in denying Atlas’s 

petition to open judgment on this basis.

Atlas next argues that the judgment should have been stricken because 

Obara failed to aver a default in the complaint. See Defendants’ brief at 21. 

According to Atlas, “neither the complaint nor the [attached] affidavit aver 

default in payment,” but instead only aver that Defendants “owe money to 

[Obara], without specifying how that is a default.” Id. at 22 (footnote 

omitted). 
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A complaint for a confession of judgment “shall contain . . . if the 

judgment may be entered only after a default or the occurrence of a condition 

precedent, an averment of the default or of the occurrence of the condition 

precedent.” Pa.R.C.P. 2952(a)(6). Unlike the requirements set forth in 

Pa.R.C.P. 1019(b) regarding an averment of fraud or mistake, “default need 

not be averred with particularity.” Stahl Oil Co., Inc. v Helsel, 860 A.2d 

508, 513 (Pa.Super. 2004). 

Obara stated in its complaint that it had disbursed $46,504 to Atlas and, 

with interest and attorney’s fees, Atlas owed Obara repayment in the amount 

of $56,672.65. See Complaint, 8/23/21, at 2-3. Additionally, it noted that it 

had attached an averment of default. Id. at 3. The attached averment 

includes an affidavit on behalf of Obara, stating that Defendants entered into 

the Term Note and Guaranty Agreement, which were included as Attachments 

A and B, respectively, and that “there is $56,672.65 due and owing under the 

Agreements.” Id. at Averment of Default. As discussed supra, the Term Note 

provided that repayment of the loan amount actually disbursed was due no 

later than July 31, 2021. Additionally, the Term Note provided that “an event 

of default under this note shall be deemed to have occurred if. . . [Atlas] 

defaults in any payment.” Term Note, 1/12/21, at ¶ 8(a) (unnecessary 

capitalization omitted). 

The trial court concluded that Obara met the requirement for averring a 

default based on the statements in the attached averment of default. See 
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Trial Court Opinion, 1/31/22, at 4. Upon review of the certified record, we 

agree that Obara sufficiently pled default in the complaint and the attached 

documents. Accordingly, the trial court did not abuse its discretion in denying 

Atlas’s petition to strike on this basis.

Finally, Defendants argue that the trial court erred in failing to award 

Mr. Gorra costs and reasonable attorney fees for Obara misidentifying him as 

a debtor in the confessed judgment action. Defendants’ brief at 23. By way 

of background, Mr. Gorra sought costs and reasonable attorney fees based on 

the misidentification pursuant to 42 Pa.C.S. § 2737.1. This section, which 

appears within the subchapter detailing the responsibilities of the office of the 

prothonotary, provides as follows:

§ 2737.1. Incorrect debtor identified

(a) Procedure.--A creditor that files for a judgment by 

confession under section 2737(3) (relating to powers and duties 

of the office of the prothonotary) shall comply with the 

Pennsylvania Rules of Civil Procedure regarding confession of 

judgment, including any notice provisions. A debtor who has been 

incorrectly identified and had a confession or judgment entered 

against him may petition the court for costs and reasonable 

attorney fees as determined by the court.

(b) Effect on judgment.--A judgment shall not be stricken or 

opened because of a creditor’s failure to provide a correctly 

identified debtor with instructions pursuant to this section 

regarding procedures to follow to strike a judgment or regarding 

any rights available to an incorrectly identified debtor.

42 Pa.C.S. § 2737.1.
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The trial court denied Mr. Gorra’s petition as it found the relief sought 

was a function belonging to the Office of Judicial Records,3 not the trial court. 

Order, 11/17/21, at 1 n.1. As such, the court denied the petition without 

prejudice for Mr. Gorra to seek relief with the Office of Judicial Records. Id. 

As a matter of first impression, Mr. Gorra argues that pursuant to § 2737.1, 

it is the trial court and not the prothonotary who determines whether to award 

costs and reasonable attorney fees. Defendants’ brief at 23-25. Mr. Gorra 

asks this Court to remand the matter to the trial court with instructions to 

dismiss him from the civil action and determine the costs and fees due under 

§ 2737.1. Id. at 28.

Obara states that it is unopposed to executing the necessary paperwork 

to dismiss Mr. Gorra from the action. Obara’s brief at 17. It contends, 

however, that Mr. Gorra has waived his request for fees by failing to follow 

the court’s directive to seek relief with the Office of Judicial Records. Id. at 

18-19. In reply, Mr. Gorra agrees with Obara’s acquiescence to dismissing 

Mr. Gorra from the action, subject to reimbursement of fees pursuant to 

§ 2737.1. Defendants’ reply brief at unnumbered 2. Mr. Gorra does not 

respond to Obara’s argument that his request for fees is waived. 

Since this is a matter of statutory interpretation, our standard of review 

is de novo and our scope of review is plenary. See Ryan v. Ruize, 268 A.3d 

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3 The Office of Judicial Records in Philadelphia was formerly known as the 

Office of the Prothonotary.
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1109, 1112 (Pa.Super. 2021) (citation omitted). Instantly, the trial court

concluded that Mr. Gorra was required to seek costs and reasonable attorney 

fees pursuant to § 2737.1 via the Office of Judicial Records because § 2737.1 

is contained within the subchapter detailing the responsibilities of the 

prothonotary. While this observation is accurate, § 2737.1 unambiguously 

states that “[a] debtor who has been incorrectly identified and had a 

confession or judgment entered against him may petition the court for costs 

and reasonable attorney fees as determined by the court.” 42 Pa.C.S. 

§ 2737.1(a) (emphasis added). Nowhere in the prothonotary subchapter is 

the prothonotary referred to as “the court.” Rather, when referencing the 

duties of the prothonotary, this subchapter utilizes “the prothonotary” and 

“the office of the prothonotary.” See 42 Pa.C.S. §§ 2732-2738; see also 42 

Pa.C.S. § 2731 (stating that the prothonotary “shall be known as the 

‘Prothonotary of (the respective) County.”). Therefore, the plain language of 

the statute clearly directs a debtor to file a petition with the court, not the 

prothonotary, for costs and reasonable attorney fees in relation to being 

misidentified as a debtor in a confessed judgment action. 

Based on the foregoing, Mr. Gorra properly petitioned the trial court for

costs and reasonable attorney fees after being misidentified as a debtor in a 

confessed judgment action, pursuant to § 2737.1, and the trial court erred in 

denying him relief outright and sending him instead to the Office of Judicial 

Records to seek relief. Accordingly, we vacate the portion of the order denying 
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Mr. Gorra’s petition and remand for the trial court to consider the merits of 

his petition for costs and reasonable attorney fees. Upon remand, the trial 

court shall also dismiss Mr. Gorra from the confessed judgment action. 

Order affirmed in part and vacated in part. Case remanded with 

instructions. Jurisdiction relinquished. 

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 7/19/2022