Schmalz v. Manufacturers & Traders Trust Co.
67 A.3d 800
| Pa. Super. Ct. | 2013Background
- CD for $12,000, issued 3/3/1970, in names Mildred Fait and Marlene Fait Schmalz; First Federal Savings Loan Association of Wilkes-Barre; later merged to become part of M&T Bank; parties sought redemption on 8/29/2003; Mildred Fait died 6/2008; writ of summons 7/30/2009 and complaint 9/23/2009; trial proceeded on failure to pay upon demand; bank moved in limine to exclude statements by Mildred Fait; trial court allowed but with continuing objection; court ruled statements were hearsay and inadmissible; evidence showed Schmalz possessed original CD not stamped redeemed; bank had no records of CD; no 1099 form or maturity/renewal notices in record; presumption that debt was paid after twenty years applied by trial court; decision favoring M&T Bank; appeal filed by Schmalz.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the in limine ruling on the mother's statements was correct | Schmalz contends statements were not hearsay or fit state-of-mind exception | Bank contends statements are hearsay and inadmissible; even if admissible, not sufficient to prove non-payment | affirmed; statements are inadmissible or fail to prove non-payment |
| Whether the debtor's twenty-year presumption applies and shifts burden | Schmalz asserts evidence shows non-payment beyond 20 years | Bank argues presumption applies and burden shifts to prove non-payment with clear evidence | affirmed; burden not met; presumption stands and debt presumed paid |
Key Cases Cited
- Rosenbaum v. Newhoff, 396 Pa. 500 (Pa. 1959) (burden shifts to creditor after 20 years; must prove non-payment with clear evidence)
- James v. Jarrett, 17 Pa. 370 (Pa. 1851) (within 20 years debtor must prove payment; after 20 years creditor must prove non-payment)
- Cope v. Humphreys, 14 Serg. & R. 15 (Pa. 1825) (early formulation of presumption of payment after 20 years)
- Gilmore v. Alexander, 268 Pa. 415 (Pa. 1920) (after 30 years presumptions require clear proof to overcome)
- Eby v. Eby’s Assignee, 5 Pa. 435 (Pa. 1846) (evidence standards for establishing nonpayment)
- Peters’s Appeal, 106 Pa. 340 (Pa. 1884) (older precedents on burden and evidence in debt claims)
- Miller v. Overseers of the Poor, 17 Pa. 159 (Pa. 1901) (evidence standards in long-delayed actions)
- Hooker v. State Farm Fire & Casualty Co., 880 A.2d 70 (Pa. Cmwlth. 2005) (state-of-mind statements may be non-hearsay if offered for effect on listener)
- Laich v. Commonwealth, 777 A.2d 1057 (Pa. 2001) (state-of-mind evidence requires relevance and proper purpose)