Deutsche Bank v. Wilson, C., Appeal of: Wilson, C. ( 2015 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
DEUTSCHE BANK TRUST COMPANY IN THE SUPERIOR COURT OF
AMERICAS, AS TRUSTEE FOR SAXON PENNSYLVANIA
SECURITIES TRUST 2003-1
Appellee
v.
CONNIE WILSON AND ZEKE WILSON
APPEAL OF CONNIE WILSON
No. 816 WDA 2014
Appeal from the Order January 23, 2014
In the Court of Common Pleas of Potter County
Civil Division at No(s): 2010-CV-20
BEFORE: GANTMAN, P.J., JENKINS, J., and MUSMANNO, J.
MEMORANDUM BY JENKINS, J.: FILED JANUARY 07, 2015
Connie Wilson (“Wife”) appeals from an order granting summary
judgment in this mortgage foreclosure action to Deutsche Bank Trust
Company Americas, as trustee for Saxon Securities Trust 2003-1 (“the
Bank”)1. We affirm.
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1
The Bank refers to itself in its brief as “Deutsche Bank Trust Company
Americas f/k/a Bankers Trust Company, as Trustee for Saxon Asset
Securities Trust 2003-1, Mortgage Loan Asset Backed Certificates, Series
2003-1.” The Bank commenced this action under the name “Deutsche Bank
Trust Company Americas, as trustee for Saxon Securities Trust 2003-1,” and
the trial court granted summary judgment to the Bank under this name.
There is no motion in the record to amend the Bank’s name. Therefore, the
(Footnote Continued Next Page)
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The record reveals that on February 24, 2003, Wife and Zeke Wilson
(“Husband”) obtained a loan in the amount of $45,850 from America’s
Moneyline Inc. The loan was evidenced by a note and secured by a
mortgage in favor of America’s Moneyline Inc. that was recorded in Potter
County2. On June 3, 2009, the mortgage was assigned to Saxon Mortgage,
Inc. and then to the Bank. Both assignments were recorded3. The note was
likewise indorsed to Saxon Mortgage, Inc., which in turn indorsed it in blank4
and transferred it to the Bank, its current holder5.
Husband and Wife failed to make mortgage payments after February
1, 20096. The Bank complied with the notice requirements under Act 6 and
Act 917 and brought this foreclosure action in January 20108. On September
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(Footnote Continued)
effect of our decision is to affirm the judgment in favor of “Deutsche Bank
Trust Company Americas, as trustee for Saxon Securities Trust 2003-1.”
2
Bank Compl. ¶ 3; Answer ¶ 3; Bank Mot. Summ. J. ¶ 5 & Exs. A, A1.
3
Bank Compl. ¶ 3; Bank Mot. Summ. J. ¶¶ 6-7 & Exs. A2, A3.
4
Bank Mot. Summ. J. ¶ 5 & Ex. A1 at 3.
5
Bank Mot. Summ. J. ¶¶ 6-7 & Ex. B ¶ 4.
6
Bank Mot. Summ. J. ¶¶ 8-10 & Exs. B & C.
7
Bank Mot. Summ. J. Ex. D (Act 6/91 notice). Act 6, the Loan Interest and
Protection Law, is codified at 41 P.S. § 101 et seq. Act 91, the Homeowner's
Emergency Mortgage Assistance Act of 1983, is codified at 35 P.S. §
1680.401c et seq.
8
Bank Mot. Summ. J. ¶¶ 11-12 & Ex. D.
(Footnote Continued Next Page)
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20, 2013, the Bank moved for summary judgment, alleging that there were
no disputed issues of fact as to the default in mortgage payments or the
Bank’s entitlement to enforce the mortgage. On January 23, 2014, the trial
court granted summary judgment to the Bank, holding that the Bank is the
real party in interest, has standing to enforce the mortgage and note, and
carried its evidentiary burden through an affidavit showing the default in
mortgage payments.
On February 21, 2014, Wife filed a timely notice of appeal. On
February 24, 2014, the trial court ordered Wife to file a Pa.R.A.P. 1925(b)
statement within 21 days. On April 10, 2014, after expiration of the 21-day
deadline, Wife filed a petition for extension of time within which to file her
Pa.R.A.P. 1925(b) statement nunc pro tunc. In an order docketed on April
16, 2014, the trial court granted Wife an additional 21 days within which to
file a Pa.R.A.P. 1925(b) statement9. On May 2, 2014, Wife filed a Pa.R.A.P.
1925(b) statement.
Before we analyze the issues raised in Wife’s appeal, we must first
determine whether Wife has waived these issues due to the untimeliness of
her Pa.R.A.P. 1925(b) statement. We conclude that the trial court properly
permitted Wife to file a Pa.R.A.P. 1925(b) statement nunc pro tunc.
Pa.R.A.P. 1925(b)(2) provides:
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(Footnote Continued)
9
Order Docketed April 16, 2014.
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The judge shall allow the appellant at least 21 days
from the date of the order’s entry on the docket for
the filing and service of the Statement. Upon
application of the appellant and for good cause
shown, the judge may enlarge the time period
initially specified or permit an amended or
supplemental Statement to be filed. Good cause
includes, but is not limited to, delay in the
production of a transcript necessary to develop the
Statement so long as the delay is not attributable to
a lack of diligence in ordering or paying for such
transcript by the party or counsel on appeal. In
extraordinary circumstances, the judge may
allow for the filing of a Statement or amended
or supplemental Statement nunc pro tunc.
Id. (emphasis added). Although the trial court’s order does not explicitly
mention the final sentence of Rule 1925(b)(2), it appears that the court
granted Wife’s petition pursuant to this provision. We review this decision
for abuse of discretion. Cf. Commonwealth v. Williams, 893 A.2d 147,
150 (Pa.Super.2006) (“an abuse of discretion standard governs our review
of the propriety of a grant or denial of an appeal nunc pro tunc”).
Wife alleged in her petition for extension that before the Pa.R.A.P.
1925 order arrived in the mail, she was forced to flee her home due to “a
domestic violence issue”, and she did not return home until April 9, 2014,
when Husband was admitted into the hospital10. During her absence, “upon
advice,” she did not leave a forwarding address with the post office “due to
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10
Wife’s Petition For Extension Of Time To File [Pa.R.A.P. 1925(b)
Statement] Nunc Pro Tunc, p. 1.
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concerns regarding [Husband’s] discovery of [her] location.”11
Communications with Husband, who remained in the home, “indicated that
there was no mail from the court.”12 Upon her return home, she found an
unopened letter from the court containing the Pa.R.A.P. 1925 order13. One
day later, she filed her petition for leave to file a Pa.R.A.P. 1925(b)
statement nunc pro tunc14.
The facts alleged in Wife’s petition were “extraordinary,” the operative
term under Pa.R.A.P. 1925(b)(2), because her domestic travails prevented
her from discovering the trial court’s Pa.R.A.P. 1925 order between its
issuance on February 24, 2014 and her return home on April 9, 2014.
Moreover, upon discovering the unopened order, she immediately filed a
petition seeking an extension of time within which to file her Pa.R.A.P.
1925(b) statement. Under these circumstances, the trial court properly
exercised its discretion by granting her leave to file her Pa.R.A.P. 1925(b)
statement nunc pro tunc.
Wife raises the following issues on appeal:
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11
Id.12
Id.13
Id.14
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1. Should the lower court’s order for summary
judgment be overturned and the complaint dismissed
with prejudice when the Complainant lacks standing
to bring the current action?
2. Should the lower court’s order for summary
judgment be overturned and the complaint dismissed
with prejudice when the Complainant has failed to
establish ownership of the original note?
3. Should the lower court’s order for summary
judgment be overturned and the complaint dismissed
with prejudice when the Complainant has failed to
properly verify their Complaint?
4. Should the lower court’s order for summary
judgment be overturned and the complaint dismissed
with prejudice when the Complainant's actions in
regard to the underlying instrument are in violation
of state and/or federal laws regulating the transfer of
financial instruments?
5. Should the lower court’s order for summary
judgment be overturned and the complaint dismissed
with prejudice when the Complainant has failed to
establish legal ownership of the mortgage and/or
underlying note?
6. Should the lower court’s order for summary
judgment be overturned and the complaint dismissed
with prejudice when the Plaintiff cannot enforce the
promissory note?
7. Should the lower court’s order for summary
judgment be overturned when both the
assignment(s) of the mortgage and the signatures
on the assignment thereof give rise to genuine
issues of material fact?
Brief For Appellant, pp. 1-2.
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Our standard of review on an appeal from the grant of a motion for
summary judgment is well-settled:
A reviewing court may disturb the order of the trial
court only where it is established that the court
committed an error of law or abused its discretion.
As with all questions of law, our review is plenary.
In evaluating the trial court’s decision to enter
summary judgment, we focus on the legal standard
articulated in the summary judgment rule. Pa.R.C.P.
1035.2. The rule states that where there is no
genuine issue of material fact and the moving party
is entitled to relief as a matter of law, summary
judgment may be entered. Where the nonmoving
party bears the burden of proof on an issue, he may
not merely rely on his pleadings or answers in order
to survive summary judgment. Failure of a non-
moving party to adduce sufficient evidence on an
issue essential to his case and on which he bears the
burden of proof establishes the entitlement of the
moving party to judgment as a matter of law. Lastly,
we will review the record in the light most favorable
to the non-moving party, and all doubts as to the
existence of a genuine issue of material fact must be
resolved against the moving party.
Murphy v. Duquesne University, 777 A.2d 418, 429 (Pa.2001).
We will consider Wife’s first, second, fifth, and sixth issues together,
because they raise the same question: whether the Bank lacks standing to
bring this mortgage foreclosure action.
In a foreclosure action, the plaintiff can prove standing either by
showing that it (1) originated or was assigned the mortgage, or (2) is the
holder of the note specially indorsed to it or indorsed in blank. J.P. Morgan
Chase Bank, NA. v. Murray, 63 A.3d 1258, 1267-68 & n.6
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(Pa.Super.2013). The trial court held, and we agree, that the Bank proved
standing both ways.
First, the Bank owns the Wilson’s mortgage via assignment. The
complaint in a mortgage foreclosure action must allege “the parties to and
the date of the mortgage, and of any assignments, and a statement of the
place of record of the mortgage and assignments.” Pa.R.Civ.P. 1147(a)(1).
The Bank’s complaint set forth the original parties and date of the Wilsons’
mortgage. It further alleged that the mortgage was assigned from the
original lender, America’s Moneyline Inc., to Saxon Mortgage Inc., and then
to the Bank. Moreover, in support of summary judgment, the Bank
submitted copies of the recorded mortgage and assignments. The recorded
mortgage assignments showed an unbroken chain from the original lender to
the Bank15. Because the Bank is the current mortgage owner, it has standing
to enforce the mortgage.
Second, the Bank holds the note for the Wilsons’ loan, and the note is
indorsed in blank. Mortgage notes are negotiable instruments under the
Uniform Commercial Code (“UCC”). Murray, supra, 63 A.3d at 1263-68.
The UCC provides that a note is payable to its bearer if it is indorsed “in
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15
Bank Mot. Summ. J. Exs. A2, A3.
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blank”, i.e., it is not indorsed to an identified person or to the bearer16. In
this case, America's Moneyline Inc. specially indorsed the note to Saxon
Mortgage. Saxon Mortgage then indorsed the note in blank17. The note was
then transferred to the Bank18. 13 Pa.C.S. § 3203(a) (“an instrument is
transferred when it is delivered by a person other than its issuer for the
purpose of giving to the person receiving delivery the right to enforce the
instrument”). Because the note is indorsed in blank, and because the Bank
currently holds it as the transferee, the Bank has standing to enforce the
Wilsons’ payment obligation. 13 Pa.C.S. § 3203(b) (“transfer of an
instrument, whether or not the transfer is a negotiation, vests in the
transferee any right of the transferor to enforce the instrument, including
any right as a holder in due course. . .”)
Wife argues unsuccessfully that the Bank lacks standing. She first
claims that the note is not indorsed in blank but instead is specially indorsed
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16
See 13 Pa.C.S. § 3205(b) (“If an indorsement is made by the holder of an
instrument and it is not a special indorsement, it is a ‘blank indorsement.’
When indorsed in blank, an instrument becomes payable to bearer and may
be negotiated by transfer of possession alone until specially indorsed”). A
“special indorsement,” in contrast, is one made by the holder of an
instrument that identifies a person to whom it makes the instrument
payable. 13 Pa.C.S. § 3205(a). Such an indorsement renders the instrument
payable to the identified person, who is the only person who may transfer
that note by subsequent indorsement. Id.
17
Bank Mot. Summ. J. Ex. A1 at 3.
18
Bank Mot. Summ. J. Ex. B ¶ 4.
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and payable to America’s Moneyline, Inc. Wife ignores the indorsement from
America's Moneyline to Saxon Mortgage and the later indorsement in blank
by Saxon Mortgage. Wife further argues that the indorsements are not
effective because they are undated. Nothing in the UCC requires an
indorsement to be dated in order to be effective. See 13 Pa.C.S. § 3204(a)
(general definition of indorsement); 13 Pa.C.S. § 3205 (definitions of blank
indorsement and special indorsement).
Wife also argues that the indorsements are ineffective because they
were made by the same person, Tracie Leckie, on behalf of both America’s
Moneyline and Saxon Mortgage. As the trial court observes, there is nothing
facially improper about the same person executing a document on behalf of
different parties. Trial Court Opinion, p. 7 (citing In Re Lampe, 665 F.3d
506, 517 (3d Cir.2011) (applying Pennsylvania law))19. Contrary to what
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19
Citing 15 Pa.C.S. § 1728, Lampe observes that a corporate officer may
stand on both sides of transaction, but he owes a duty of care and a
fiduciary duty to both corporations. Section 1728 further confirms that a
corporate officer may stand on both sides of the transaction, providing in
relevant part:
A contract or transaction between a business
corporation and one or more of its directors or
officers or between a business corporation and
another domestic or foreign corporation for profit or
not-for-profit, partnership, joint venture, trust or
other enterprise in which one or more of its directors
or officers are directors or officers or have a financial
or other interest, shall not be void or voidable solely
for that reason, or solely because the director or
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Wife claims, the Bank did not have the burden of proving that Leckie could
sign on behalf of both America’s Moneyline and Saxon Mortgage, since there
was nothing inherently suspect about her doing so. 15 Pa.C.S. § 1728;
Lampe, supra, 665 F.3d at 517.
Finally, Wife argues that the Bank cannot enforce the note because it
did not produce the original note for inspection. The Bank submitted an
affidavit attesting that it was the legal owner of the note and attaching a
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(Footnote Continued)
officer is present at or participates in the meeting of
the board of directors that authorizes the contract or
transaction, or solely because his or their votes are
counted for that purpose, if:
(1) the material facts as to the relationship or
interest and as to the contract or transaction are
disclosed or are known to the board of directors and
the board authorizes the contract or transaction by
the affirmative votes of a majority of the
disinterested directors even though the disinterested
directors are less than a quorum;
(2) the material facts as to his relationship or
interest and as to the contract or transaction are
disclosed or are known to the shareholders entitled
to vote thereon and the contract or transaction is
specifically approved in good faith by vote of those
shareholders; or
(3) the contract or transaction is fair as to the
corporation as of the time it is authorized, approved
or ratified by the board of directors or the
shareholders.
15 Pa.C.S. § 1728(a).
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true and correct copy of the note20. This is sufficient evidence of the Bank’s
possession of the note and establishes it as the note holder entitled to
enforce the instrument. 13 Pa.C.S. §§ 1201, 3301. If Wife wanted to
physically inspect the note, she could have done so through discovery. See
Pa.R.Civ.P. 4009.1(a) (procedure for requesting inspection of designated
documents). Wife failed to take advantage of this mechanism.
We now turn to Wife’s third argument on appeal, her claim that the
Bank failed to provide a proper verification to its complaint. The complaint
was verified by Regina Alexander, Assistant Vice President of Saxon
Mortgage Services, Inc. Alexander stated that she had authority to verify
the complaint on behalf of Saxon Mortgage Services, Inc., which was the
servicing agent and attorney-in-fact for the Bank at that time. Alexander
also states that the allegations in the complaint are "true and correct to the
best of my knowledge, information and belief."
Although the verification to the Bank’s complaint might be technically
incorrect,21 we do not find that Wife suffered any prejudice from Alexander’s
verification. The Rules of Civil Procedure “shall be liberally construed to
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20
Bank Mot. Summ. J. Ex. B ¶ 4.
21
The verification might violate Rule 1024(c) because it is signed by an
employee of the Bank’s agent, Saxon Mortgage Services, Inc., instead of by
an employee of the Bank itself. In such circumstances, the verification
should explain why a Bank employee did not sign the verification. Id. This
verification fails to provide any such explanation.
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secure the just, speedy and inexpensive determination of every action or
proceeding to which they are applicable. The court at every stage of any
such action. . .may disregard any error or defect of procedure which does
not affect the substantial rights of the parties.” Pa.R.Civ.P. 126 (emphasis
added). The verification did not affect Wife’s substantive rights, since there
is no dispute that the mortgage is in default22.
In her fourth argument on appeal, Wife complains that the Bank’s
actions “are in violation of state and/or federal laws regulating the transfer
of financial instruments,” because the signatories to the mortgage
assignments are so-called “robo-signers”. Wife waived this argument by
failing to raise it in the trial court. Pa.R.A.P. 302 (“issues not raised in the
lower court are waived and cannot be raised for the first time on appeal”).
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22
The Bank asserted in paragraphs 8-10 of its motion for summary
judgment that the mortgage is in default and attached an affidavit
confirming the default and amount of the debt. In response, Husband’s and
Wife’s answer to the motion for summary judgment simply states: “Denied.”
This is not sufficient to raise a genuine issue of fact concerning the default in
payment. See Pa.R.Civ.P. 1035.3(a) (providing in relevant part that the
respondent to a motion for summary judgment “may not rest upon the mere
allegations or denials of the pleadings but must file a response. . .identifying
(1) one or more issues of fact arising from evidence in the record
controverting the evidence cited in support of the motion or from a challenge
to the credibility of one or more witnesses testifying in support of the
motion, or (2) evidence in the record establishing the facts essential to the
cause of action or defense which the motion cites as not having been
produced”).
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Finally, in her seventh argument on appeal, Wife argues that “both the
assignment(s) of the mortgage and the signatures on the assignment
thereof give rise to genuine issues of material fact.” Her argument on this
point is nothing more than a boilerplate claim of lack of authenticity. Brief
For Appellant, pp. 18-19 (“while it is clear in this case that an assignment of
mortgage was filed prior to commencement of this action, the authenticity
and validity of the documents is questionable because simply filing it does
not make it a truthful document and that inference is in favor of the
Defendants”). Wife failed to submit evidence in response to the Bank’s
motion for summary judgment that raised a genuine issue of material fact
concerning the authenticity of these documents.
For these reasons, we affirm the order granting summary judgment to
the Bank.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 1/7/2015
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