Opinion by
This is an appeal from an order of the Court of Common Pleas of Montgomery County dismissing appellant corporation’s petition to open a judgment of
In 1968, appellant (Pepper), a multi-million dollаr business, the largest broker of radio and television advertising and programming time in the United States, sought to diversify by purchasing a line of men’s toiletries produced by appellee (I.E.C.). After negotiations between top corporate officers and counsel, an agreement of sale was executed on July 29, 1968. President Judge Groshens of the court below ably summarizes the significant terms of the agreement as follows:
“1. Sale of Inventory. In essence, I.E.C. agreed to sell to Pepper its inventory of merchandise, packaging, and promotional materials.
“2. Sale of Trademarks. I.E.C. agreed to sell to Pepper ‘all right, title, and interest’ of I.E.C. in certain trademarks. The United States Trademark registrations enumerated were ‘Mark II,’ ‘Inferno,’ and ‘Rogue’. In addition the agreement refers to the trademark ‘British Rogue’, for which no application for registration had been filed, and thе trademark ‘400 XL’ on which an application was pending.
“3. Quality of the Purchase. With respect to the quality of the inventory sold, Paragraph 10 of the agreement provides as follows: ‘Promptly after the execution of this agreеment representatives of the parties shall make a physical count of the inventory of merchandise, packaging and promotional material to be sold hereunder and shall determine the cost thereof as provided in paragraph 2b. The inventory for this purpose shall include all the items of the nature set forth*121 iii Exhibit “A” and no allowances shall be made for items claimed to be unusable or unsalеable:’.
“'4. Installment Payments. The agreement provided for the payment to I.E.C. of a sum to be computed on the basis of the cost to I.E.C. of the inventory. Pepper agreed to pay $10,000.00 of the purchase price upon signing the agreement and the balance in four installments due on December 31, 1968; June 30, 1969; June 30,1970; and June 30,1971. The unpaid balance of the purchase price was to be evidenced by a promissory note delivеred at closing.” (E. 590a-591a.)
The closing under this agreement took place on August 12,1968; I.E.C. delivered a bill of sale and assignment transferring its inventory and the trademarks to Pepper. At closing, Pepper delivered to I.E.C. a judgment note for the balance of the purchase price. The note provided for payment in four installments, the first due December 31, 1968, and the other three due annually thereafter on or before Junе 30. The instrument also provided, in the event of default, for acceleration of the installments, payment of reasonable legal fees, and confession of judgment by attorney under the cognovit system in “Pennsylvania or elsewhere”.
Pepper paid the first two installments on the judgment note when they were due. However, they were by no means content with the line of men’s toiletries purchased from I.E.C., having experienced marketing difficulties, trademark problems, and some product deterioration. In an attempt to recoup part of its losses from the venture, Pepper sold the bulk of its inventory of “Mark II” cosmetics tо Flex Electric Products, Inc. (Flex). In partial payment, Flex agreed to pay the remaining balance due on the judgment note. However, Flex soon experienced its own problems with the cosmetics; primarily, the product was deteriorating on the shelf.
I.E.C.’s counsel formally demanded payment of the overdue installment on July 1, 1970, advising Pepper that unless payment was made within 15 days the remaining (fourth) installment would accelerate and become immediately due. On July 31,1970, Pepper wrote to I.E.C. enclosing its check for $25,582.96 of the $64,-039.61 due on the third installment, having applied that amount of receivables it then owed to Flex. I.E.C. acknowledged the partial payment on August 10, 1970, but refused to further extend the time for payment of the installment. Pepper contends that I.E.C. and Flex then agreed that I.E.C. would not accelerate the note, provided that Flex made a payment of $10,000.00 on the balance due, by August 17. The parties agree that Flex made no payments at any time. On August 26, 1970, I.E.C. took judgment on the note. The court below dismissed Pepper’s petition to open judgment and the present appeal followed.
I
The most recеnt decisions of the United States Supreme Court in Swarb v. Lennox,
“1. The Pennsylvania system leading to confessed judgment and execution does comply with due process standards provided There has been an understanding and voluntary consent of the debtor in signing the document.’ 314 P. Supp., at 1095.
“2. If, however, there is no such understanding consent, the procedure violates due process requirements of notice and an opportunity to be heard. Ibid.
“4. The record did not establish that the action could be maintained as a class aсtion on behalf of individual natural persons with annual income of more than |10,000. Id., 1098-1099.
“5. It could be maintained, however, as a class action on behalf of natural persons residing in Pennsyl*124 vania who earn less than $10,000 annuаlly and who signed consumer financing or lease contracts containing cognovit provisions. Id., 1099.
“The court then declared the Pennsylvania practice of confessing judgments to be unconstitutional, . . . ., as aрplied to the class designated, and enjoined the entry of any confessed judgment against a member of the class in the absence of a showing of the required waiver. Id., 1103. The judge dissenting did so as to the limitation of rеlief to those earring less than $10,-000 annually. Id., 1102.”405 U.S. at 198-200 .
Mr. Justice Blackmun delivered this opinion of the Court in Swarb affirming the decision of the District Court. He states that the “claim is that the District Court erred in confining the relief it granted . . . and that the court should have declared the Pennsylvania rules and statutes unconstitutional on their face. A holding of facial unconstitutionality, of course, wholly apart from any class consideration, would afford relief to every Pennsylvania cognovit obligor. Todаy’s decision in Overmyer, although it concerns a corporate and not an individual debtor, is adverse to this contention of the plaintiff-appellants. In Overmyer it is recognized, . . ., that, under appropriate circumstances, a cognovit debtor may be held effectively and legally to have waived those rights he would possess if the document he signed had contained no cognovit provisions.”
The instant case is clearly controlled by the Supreme Court’s decisions in Swarb and Overmyer, being almost identical factually to the latter. As there, the cognovit clause here was entered into by a corporation with widespread operations as part of a contract bargained for between two corporate businesses. This was not a contract of adhesion. Further, Pepper, a huge
II
A petition to open a default judgment is an appeal to the court’s discretion, Fox v. Mellon,
The order of the lower court is affirmed.
Notes
Entered pursuant to Pa. R. C. P. 2950 et seg. (1971), which provide in part, that a confession of judgment for money “may be entered by the prothonotary . . . without the agency оf an attorney and without the filing of a complaint, declaration or confession, for the amount which may appear to be due from the face of the instrument.” (Rule 2951(a)).
Philadelphia National Bank.
On November 23, 1970, six days after it had filed its рetition to open judgment and secured a stay of all proceedings, Pepper petitioned to remove this case to the United States District Court for the Eastern District of Pennsylvania. I.E.C. then filed a motion to remand. On February 8, 1971, Judge E. Mac Tkotjtman of the District Court ruled that the removal was untimely and remanded the case back to the court below.
Pa. R. C. P. 2950 et seq. (1971).