CHAPTER 240

FORMERLY SENATE BILL NO. 470

AS AMENDED BY HOUSE AMENDMENT NO. 1

AN ACT TO AMEND TITLE 10, DELAWARE CODE, RELATING TO ENTRY OF JUDGMENTS BY CONFESSION; AND TO AMEND TITLE 7, DELAWARE CODE, RELATING TO BOND OF THE SECRETARY-TREASURER FOR THE TAX DITCH; AND TO AMEND TITLE 24, DELAWARE CODE, RELATING TO PAWN BROKER'S BOND.

Be it enacted by the General Assembly of the State of Delaware:

Section 1. Title 10, Delaware Code, Section 2306, is hereby amended by, striking said Section in its entirety and substituting in lieu thereof a new Section 2306 to read as follows:

§ 2306. Entry of judgment by confession

(a) A judgment by confession may be entered by the Prothonotary, either for money due or to become due, or to secure the Obligee against a money contingent liability, or both, on the application by the Obligee or Assignee of a bond, note or other obligation containing a warrant for an attorney at law or other person to confess judgment.

(b) A judgment by confession shall not be entered as a final judgment, effective in all respects as a judgment after trial, until the Prothonotary gives written notice to the Defendant-Obligor by certified mail, return receipt requested, of an opportunity for a judicial determination as to whether the Defendant-Obligor understandingly waived his right to notice and an opportunity to be heard prior to the entry of final judgment against him.

() In the case of a Defendant-Obligor who was at the time of executing the document authorizing the confession of judgment, a non-resident, the Plaintiff must also file with the Prothonotary an affidavit executed by the Defendant-Obligor stating:

(1) The sum of money for which judgment may be entered.

(2) Authorization of entry of judgment in the Superior Court of the State of Delaware in and for a specific County.

(3) The contact with the State of Delaware in the transaction.

(4) Defendant-Obligor's mailing address and residence where he most likely would receive mail.

(d) The Prothonotary shall send by certified mail, return receipt requested, a copy of the document authorizing the confession of judgment, the notice as aforesaid and, where applicable, he shall also send a copy of the Defendant-Obligor's affidavit provided for in paragraph (c) herein.

(e) When service cannot be effected by certified mail, return receipt requested, service shall be accomplished by the publication of said notice once per week for two weeks in a newspaper of general circulation in the County in which the judgment is sought to be entered and also once per week for two weeks in a newspaper of general circulation in the County in which the Defendant-Obligor is last known to have resided.

(f) Prior to the issuance of any writ of execution sought on a confessed judgment entered prior to the effective date of this statute, the Prothonotary shall serve on the Defendant-Obligor by certified mail, return receipt requested, or in the event of failure of service in that manner, by publication as heretofore provided, the notice as provided for in paragraph (b) herein. If the Defendant-Obligor appears to contest the judgment, his appearance shall be noted and in the case of non-residents, the appearance shall constitute the appointment of the Prothonotary as his agent to receive service. In that case, the Prothonotary must immediately forward to the Defendant-Obligor all such service he receives, pursuant to the provision hereinafter by this statute or by Court rule, to the Defendant-Obligor by certified mail, return receipt requested. Thereafter, the issues shall be joined on the question of the indebtedness and the question of whether there was an understanding waiver of notice and an opportunity to be heard prior to judgment having been entered against the Defendant-Obligor. At the hearing on the issues, if Plaintiff prevails, the

lien of his judgment shall relate back to the date of its original entry.

(g) At the conclusion of the hearing provided for in paragraph (b) herein, if the Plaintiff prevails on the issue of whether the Defendant-Obligor understandingly waived notice and an opportunity to be heard prior to the entry of judgment against him, then judgment shall be entered by the Prothonotary pursuant to Section 2306 herein as of the date the confessed judgment was originally lodged with the Prothonotary.

(h) In addition to the procedure herein set forth, the Superior Court may adopt Rules for confession of judgments by Defendant-Obligor in open Court; provided, however, the Debtor is afforded a judicial determination on the question of whether he has understandingly waived any of his constitution_al rights concerning the entry of judgment and the right to execution thereon.

() The Superior Court may adopt appropriate and specific Rules to effectuate the intent and purpose of this statute.

(a) Notwithstanding the opportunity for hearing provided in paragraph (b) above the Defendant-Obligor will not be deemed to have waived the right to present defenses of which he had no knowledge at the time he signed the instrument containing a warrant of attorney to confess judgment, or which arose subsequent to the signing of such instrument. A stay of execution shall be automatically given on all judgments entered hereunder until the Defendant-Obligor is afforded an opportunity for hearing to present those defenses not deemed to have been waived. Prior to execution the Prothonotary shall serve notice to the Defendant-Obligor in the manner above provided for residents or non-residents as the case may be, and such notice shall include a warning that Defendant-Obligor's property will be seized and sold or his wages attached on failure to appear.

Section 2. Title 10, Delaware Code, is hereby amended by striking Sections 9547 and 9548 in their entirety.

Section 3. Title 10, Delaware Code, is hereby amended by striking the period at the end of Section 3908 thereof and adding thereto the following:

"except as provided for in Title 10, Section 2306."

Section 4. Title 7, Delaware Code, Section 4164, is hereby amended by striking the following as contained therein:

To the bond and condition, there shall be annexed a warrant or power of attorney to confess judgment thereon in the usual form.

Section 5. Title 24, Delaware Code, Section 2305, is hereby amended by striking the following:

The bond shall be filed with the Clerk of the Peace of New Castle County.

and substituting in lieu thereof:

The bond shall be filed with the Prothonotary of the Superior Court in New Castle County.

Approved July 9, 1971.