Haverford Hill Condo Assoc. v. M.K. Lekoma ( 2021 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Haverford Hill Condominium :
Association, :
:
Appellant :
:
v. : No. 1127 C.D. 2020
: Argued: June 7, 2021
Michelle K. Lekoma :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE ELLEN CEISLER, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE WOJCIK FILED: August 18, 2021
Haverford Hill Condominium Association (Association) appeals the
October 8, 2019 order of the Delaware County Court of Common Pleas (trial court),
denying the Association’s petition to remove the action from arbitration. Upon
review, we quash the appeal.
On January 2, 2019, the Association filed a two-count complaint
against Michelle Lekoma (Lekoma) for claims of breach of the Association’s
Declaration for failure to pay condominium assessments as required under the
Declaration and the Uniform Condominium Act (Condominium Act),1 and a claim
for the entry of Judgment of Foreclosure based on the failure to pay the assessments.
1
68 Pa. C.S. §§3101-3414.
Reproduced Record (R.R.) at 11a-18a.2 The matter was scheduled for arbitration.
The Association requested, and was granted, two continuances.
By a July 10, 2020 email, the Association inquired of the trial court’s
Civil Court Administrator (Administrator) as to why the instant condominium lien
foreclosure action was assigned to arbitration. R.R. at 106a. In a reply email, the
Administrator stated: “It is the [trial court’s] position on any foreclosure cases that,
if the amount in controversy is $50,000 or less, the case should proceed to
[a]rbitration as there is no determination that needs to be made regarding title to
property.” Id. at 105a.
In a response, the Association sent an email to the Administrator, which
stated, in relevant part:
2
In Count I of the Complaint, seeking Judgment of Foreclosure, the Association merely
alleges that it “makes assessments against the units . . . pursuant to its authority under 68 Pa. C.S.
§3314”; Lekoma “unilaterally and without excuse or explanation to the Association resolved to
cease paying assessments”; “[d]espite demand, [Lekoma] has failed to make payments for
assessments through the date of this Complaint, and it is believed that [Lekoma] will continue to
fail to make payments for assessments as they come due”; and “[t]he Association has expended
and will expend significant legal fees and costs in the collection of the past-due assessments and
enforcement of its Declaration, Bylaws, Rules and Regulations, and such fees and costs are due
from [Lekoma] as additional assessments under 68 Pa. C.S. §3315.” R.R. at 15a. Rule 1147(a)(5)
of the Pennsylvania Rules of Civil Procedure, Pa. R.C.P. No. 1147(a)(5), governing Actions in
Mortgage Foreclosure, states that “[t]he plaintiff shall set forth in the complaint: . . . an itemized
statement of the amount due; and [] a demand for judgment for the amount due.” (Emphasis added.)
However, Count I does not contain the required itemized statement of any amount purportedly due
from Lekoma, or a demand for judgment for the amount that is purportedly due.
In addition, Pa. R.C.P. No. 1146, also governing Actions in Mortgage Foreclosure,
provides that “[t]he plaintiff may state in the complaint two or more grounds for foreclosure but
may not state more than one cause of action.” As outlined above, the Association also asserted a
Breach of Declaration cause of action against Lekoma in Count II of the Complaint. See R.R. at
16a. See also London Towne Homeowners Association v. Karr, 866 A.2d 447, 452 (Pa. Cmwlth.
2004) (“An action of mortgage foreclosure is an action at law governed by [Pa. R.C.P. Nos.] 1141-
1150; 22 Standard Pennsylvania Practice 2d §121:30 (2003). These procedural requirements must
be strictly followed (citation omitted).”).
2
A foreclosure involves title to the property – that is the
entire point of a foreclosure action. The purpose of the
foreclosure is to enforce the lien, obtain a judgment
against the property and then sell the property via sheriff’s
sale. Further your explanation is contrary to [Section
7361(b)(1) of the Uniform Arbitration Act (UAA), 42
Pa. C.S. §7361(b)(1),3] which states that matters which
involve title to real property are not to be submitted to
compulsory arbitration. [Rule *1301 of the Delaware
County Local Rules of Civil Procedure, Del. Co. R.C.P.
*1301,4] concerning actions submitted to compulsory
arbitration in accordance with Section 7361, [states that it]
“does not apply to cases involving title to real estate.”
Foreclosure of condominium liens are in rem. See
Gateway Towers [Condominium Association] v. Krohn,
845 A.2d 855, 858 (Pa. Super. 2004). In rem actions
determine the status of a property. See Black’s Law
Dictionary (9th ed.), p. 919.
Moreover, the Association is permitted, under the
Condominium Act, to foreclose its lien against a unit. 68
Pa. C.S.[] §3315(a).[5] By preventing the Association from
3
Section 7361(b)(1) of the UAA states that “[n]o matter shall be referred [to mandatory
arbitration] under subsection (a) . . . which involves title to real property[.]” 42 Pa. C.S.
§7361(b)(1).
4
Del. Co. R.C.P. *1301(a) states:
(a) In accordance with [Section] 7361 of the [UAA, 42 Pa. C.S.
§7361], all civil cases, to include assessments of damages, where the
amount in controversy, exclusive of interest and costs, does not
exceed $50,000.00 shall first be tried before a board of arbitrators.
This rule does not apply to cases involving title to real estate nor to
other cases prohibited from reference to a board of arbitrators under
existing law.
5
Section 3315(a) of the Condominium Act states, in pertinent part, that “[t]he association
has a lien on a unit for any assessment levied against that unit or fines imposed against its unit
owner from the time the assessment or fine becomes due. The association’s lien may be foreclosed
in like manner as a mortgage on real estate.” 68 Pa. C.S. §3315(a). See also Section 3315(e), 68
Pa. C.S. §3315(e) (“Nothing in this section shall be construed to prohibit actions or suits to recover
(Footnote continued on next page…)
3
obtaining a foreclosure judgment, the court is prejudicing
the statutory rights of the Association. There is no
monetary base requirement for the Association to file a
foreclosure action, nor have I seen any in case law or
statutes which state that if the amount due on a lien
involving real property is less than $50,000, then it does
not involve the title to the real property.
The Association demands that this matter be removed
from the arbitration per Pennsylvania law as its rights are
being prejudiced.
R.R. at 104a-05a.
In a reply email, the Administrator stated:
The [trial] court will not remove this matter from
arbitration, sua sponte. It is the consensus of the [trial]
court that foreclosure matters do not involve a
determination as to title to the real estate.
The remedy available to you is the filing of a motion to
have the matter removed from arbitration. However, I can
tell you that, historically, such motions raising this same
issue have been denied.
R.R. at 104a.
As a result, on July 21, 2020, the Association filed a Petition to Remove
Action from Arbitration (Petition). R.R. at 2a-5a. On October 8, 2020, the trial
court denied the Association’s Petition, id. at 104a, explaining that the Association’s
complaint “seeks a monetary judgment and foreclosure upon a condominium lien.
Neither of these items of relief involve title to real property as would an action for
specific performance or for quiet title to a property.” Trial Court 12/15/20 Opinion
at 3 (citation omitted).
sums for which subsection (a) creates a lien or to prohibit an association from taking a deed in lieu
of foreclosure.”); Karr, 886 A.2d at 452 (“However, an association may also pursue payment of
unpaid assessments by employing remedies less drastic than foreclosure. It is free, for example,
to bring an action in debt or in contract to collect an assessment.”).
4
The trial court also determined that its order denying the Petition does
not constitute an appealable collateral order under Rule 313 of the Pennsylvania
Rules of Appellate Procedure, Pa. R.A.P. 313,6 because “[a]n [a]rbitration of [the
Association’s] claims as it consistently sought for eighteen (18) months prior to the
filing of its [Petition], would result in the entry of an [a]ward which would be subject
to appeal by either party,[7]” so that “no claim will be lost by anyone.” Trial Court
12/15/20 Opinion at 2. Moreover, the trial court noted that “it is not sufficient that
the issue involved be important to the particular parties. Rather, it must involve
rights deeply rooted in public policy going beyond the particular litigation at hand.”
Id. (citation omitted). The trial court held that “[t]he issues involved in the
[Association’s Petition] do not satisfy the foregoing standard and thus it is submitted
that this Court’s [order denying the Petition] is not [c]ollateral in nature but rather
interlocutory and not subject to immediate appeal.” Id. The Association then filed
the instant appeal to this Court.8
On appeal, the Association argues that this Court possesses jurisdiction
to consider this appeal because it is an appeal from a collateral order under
Pa. R.A.P. 313. The Association also asserts that the trial court violated Section
6
Pa. R.A.P. 313(a) provides, in pertinent part, that “[a]n appeal may be taken as of right
from a collateral order of a trial court[.]”
7
See Section 7361(d) of the UAA, 42 Pa. C.S. §7361(d) (“Any party to a matter shall have
the right to appeal for trial de novo in the court.”); Pa. R.C.P. No. 1307(c) (“If no appeal is taken
within thirty days after the entry of the award on the docket, the prothonotary on praecipe shall
enter judgment on the award.”).
8
“The question of the appealability of an order goes to the jurisdiction of the Court
requested to entertain the question.” Fried v. Fried, 501 A.2d 211, 212 (Pa. 1985) (citations
omitted). “With regard to jurisdictional questions and other questions of law, our standard of
review is de novo, and our scope of review is plenary.” Commonwealth ex rel. Kane v. Philip
Morris, Inc., 128 A.3d 334, 340 n.5 (Pa. Cmwlth. 2015) (citations omitted).
5
7361(b)(1) of the UAA, Pa. R.C.P. No. 1301,9 and Del. Co. R.C.P. *1301, by
submitting a matter involving title to real property to arbitration.
“In this Commonwealth, there are few legal principles as well settled
as that an appeal lies only from a final order, unless otherwise permitted by rule or
statute.” McCutcheon v. Philadelphia Electric Company, 788 A.2d 345, 349 (Pa.
2002). As our Supreme Court explained:
Pa. R.A.P. 341 defines a “final order” in clear and
unambiguous terms. In relevant part, Rule 341 provides
that “[a] final order is any order that: (1) disposes of all
claims and of all parties . . . .” Pa. R.A.P. 341(b)(1). In
other words, an order satisfies the Rule’s definition if it
ends the litigation as to all claims and as to all parties.
Note to Pa. R.A.P. 341.
McCutcheon, 788 A.2d at 350.
Additionally, as this Court has observed:
It is well[]settled that an order compelling
arbitration is not a final, appealable order. Maleski [v.
Mutual Fire, Marine and Inland Insurance Co., 633 A.2d
1143, 1145 (Pa. 1993)]; Rosy v. Nat[ional] Grange
Mut[ual] Ins[urance] Co., 771 A.2d 60 (Pa. Super. 2001).
When a trial court compels arbitration, the action is stayed
9
Pa. R.C.P. No. 1301 states: “These rules apply to actions which are submitted to
compulsory arbitration pursuant to local rule under Section 7361 of the [UAA], 42 Pa. C.S.
§7361.” The Comment to this Rule states, in relevant part:
In determining which actions to include or exclude, the nature of the
action and the relief requested should govern. Obviously, actions
which require equitable or declaratory relief are not to be referred.
The grant of such relief is beyond the power of arbitrators.
Similarly, actions to quiet title, mandamus, quo warranto and
mortgage foreclosure, which require other than monetary relief, are
not appropriate.
Pa. R.C.P. No. 1301 cmt.
6
pending arbitration, and the trial court retains jurisdiction
and supervision over the arbitration. Maleski. The trial
court does not address the merits of the parties’ claims but
merely transfers their dispute to another forum in
accordance with the arbitration provision of the underlying
contract.[10] Fastuca v. L.W. Molnar & Assoc[iates], 950
A.2d 980 (Pa. Super. 2008), aff’d, [10 A.3d 1230 (Pa.
2011)]. Consequently, an appellate court lacks
jurisdiction to determine the merits. Maleski.
As the Supreme Court explained, an order
compelling arbitration is not appealable because “the
parties are not forced ‘out of court.’” Id. at 1145 (quoting
Gardner v. Prudential Ins[urance] Co., [481 A.2d 654,
655 (Pa. Super. 1984)]). “[A]n order compelling
arbitration forces the parties into, rather than out of,
court.” Id.; accord Rosy.
Philip Morris, Inc., 128 A.3d at 343.
Section 7320(a)(1) of the UAA allows for appeals from “[a] court order
denying an application to compel arbitration made under section 7304 (relating to
proceedings to compel or stay arbitration).” 42 Pa. C.S. §7320(a)(1). However, the
UAA does not provide for an appeal from an order denying removal from arbitration.
Therefore, this Court lacks jurisdiction to hear this appeal as it does not flow from a
final, appealable order. 42 Pa. C.S. §7320(a); Maleski.
Nevertheless, as outlined above, “[a]n appeal may be taken as of right
from a collateral order of a trial court[.]” Pa. R.A.P. 313(a). Pa. R.A.P. 313(b)
provides:
[A] collateral order is[: (1)] an order separable from and
collateral to the main cause of action[; (2)] where the right
involved is too important to be denied review[;] and [(3)]
the question presented is such that if review is postponed
until final judgment in the case, the claim will be
irreparably lost.
10
Or, in this case, pursuant to Del. Co. R.C.P. *1301(a) and the trial court’s order.
7
For an interlocutory order to be deemed a collateral, appealable order, all three
elements must be present. Fried, 501 A.2d at 214.11
Indeed, as this Court has explained:
The collateral order doctrine must be narrowly
construed, and all three prongs must be met before
collateral appellate review is allowed. “Narrow
application prevents the collateral order rule from
subsuming the fundamental general precept that only final
orders are appealable and from causing litigation to be
interrupted and delayed by piecemeal review of trial court
decisions.” If “an order satisfies [Pa. R.A.P.] 313’s three-
pronged test,” we “may exercise appellate jurisdiction
where the order is not final.”
In determining whether an order is separable from
and collateral to the main cause of action, the Court must
first decide whether review of the order implicates the
merits of the main cause of action. In other words, we
examine “whether the issues appealed can be addressed
without analysis of the underlying claims on the merits.”
Where review of the order in question does not implicate
or affect the merits of the underlying dispute, it is
separable from and collateral to the main cause of action.
As for the second prong, “[a]n issue is important if
the interests that would potentially go unprotected without
immediate appellate review of that issue are significant
relative to the efficiency interests sought to be advanced
by the final judgment rule.” “[I]t is not sufficient that the
issue be important to the particular parties. Rather[,] it
must involve rights deeply rooted in public policy going
beyond the particular litigation at hand.” Generally, the
implication of due process concerns is too important to be
denied review.
11
An interlocutory appeal may also be taken by permission pursuant to Section 702(b) of
the Judicial Code, 42 Pa. C.S. §702(b). However, the Association failed to seek the trial court’s
permission to appeal the instant order.
8
Finally, with regard to the third prong of the
analysis, we ask “whether a right is ‘adequately
vindicable’ or ‘effectively reviewable.’” This question
“cannot be answered without a judgment about the value
interests that would be lost through rigorous application of
a final judgment requirement.” For instance, the
substantial cost a party would incur in defending a claim
may equate to an irreparable loss of a right to avoid the
burden entirely.
As discussed above, an order compelling arbitration
is generally not appealable as an interlocutory order under
Pa. R.A.P. 311(a)(8)[12] and Section 7320 of the UAA.
However, such an order may be appealable as a collateral
order in limited circumstances. See, e.g., Gilyard v.
Redev[elopement] Auth[ority] of Phila[delphia], 780 A.2d
793 (Pa. Cmwlth. 2001); U.S. Auto[mobile] Assoc[iation]
v. Shears, 692 A.2d 161 (Pa. Super. 1997)[.]
Philip Morris, Inc., 128 A.3d at 344-45 (citations and footnotes omitted).
As outlined above, in this case, the trial court appropriately determined
that the order denying the Association’s Petition is not an appealable, collateral order
because the second and third elements provided in Pa. R.A.P. 313(b) are not present.
Specifically, the trial court’s order will not prejudice the Association’s right to
ultimately obtain the requested recovery based on the properly pleaded Count II in
personam claim against Lekoma, or the improperly pleaded Count I in rem claim
against Lekoma’s unit, and does not implicate any important and unprotected public
policy interest. See, e.g., Geniviva v. Frisk, 725 A.2d 1209, 1213-14 (Pa. 1999)
(“Only those claims that involve interests ‘deeply rooted in public policy,’ can be
considered ‘too important to be denied review.’ This case involves no such claims.
The common pleas court’s order denying the motion to approve settlement
12
Pa. R.A.P. 311(a)(8) provides that “[a]n appeal may be taken as of right and without
reference to Pa. R.A.P. 341(c) from . . . [a]n order that is made final or appealable by statute . . . ,”
such as an order denying an application to compel arbitration pursuant to Section 7320(a)(1) of
the UAA.
9
implicates no policy interests of sufficient import that immediate appeal was
required.”) (citation and footnote omitted). Because there is no express authority
providing for an appeal from an interlocutory order in a case where removal from
arbitration is denied, we must quash Association’s appeal.13
Accordingly, the instant appeal will be quashed.
MICHAEL H. WOJCIK, Judge
13
Based on our disposition of this issue, we will not consider the remaining appellate
claims.
10
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Haverford Hill Condominium :
Association, :
:
Appellant :
:
v. : No. 1127 C.D. 2020
:
Michelle K. Lekoma :
ORDER
AND NOW, this 18th day of August, 2021, the above-captioned appeal
of Haverford Hill Condominium Association from the October 8, 2019 order of the
Delaware County Court of Common Pleas is QUASHED.
__________________________________
MICHAEL H. WOJCIK, Judge