The Bank of New York Mellon v. Pryor, M. ( 2017 )

J-A08035-17
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
THE BANK OF NEW YORK MELLON : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
MIRIAM PRYOR :
:
Appellant : No. 2610 EDA 2015
Appeal from the Order Dated July 15, 2015
In the Court of Common Pleas of Montgomery County
Civil Division at No(s): 2014 08760
BEFORE: PANELLA, LAZARUS, JJ., and STEVENS, P.J.E.*
MEMORANDUM BY STEVENS, P.J.E.: FILED April 25, 2017
In this mortgage foreclosure action, Miriam Pryor (“Appellant”) appeals
pro se from the July 15, 2015, order granting the Bank of New York Mellon’s
(“Appellee”) motion for summary judgment, awarding its judgment in rem
for $655,218.18, plus interest and costs, and dismissing with prejudice
Appellant’s counterclaim. We affirm.
The relevant facts and procedural history are as follows: On February
23, 2007, Appellant executed a mortgage and promissory note for
$315,000.00 to Madison Equity Corporation, for real property located at
1360 Horseshoe Drive, Blue Bell, Pennsylvania. On March 26, 2007, the
mortgage was duly recorded, and on May 21, 2008, the mortgage was
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*
Former Justice specially assigned to the Superior Court.
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transferred to Madison Equity Corporation. On December 12, 2008, the
mortgage was transferred to Appellee.
On April 21, 2014, Appellee commenced the instant action by filing a
complaint in mortgage foreclosure averring that payments had not been
received for November 2007 and all payments thereafter. Thus, as of April
7, 2014, the amount due, including interest, fees, and legal costs, totaled
$620,263.03. Appellee sought a judgment in rem for foreclosure of the
mortgage property in the stated amount.
On July 7, 2014, Appellant filed a pro se answer, new matter, and
counterclaim raising allegations of predatory lending, use of an exorbitant
interest rate, fraud in the inducement, and bad faith. Among other things,
Appellant sought counsel fees pursuant to 42 Pa.C.S.A. § 2503, as well as
monetary damages.
On July 25, 2014, Appellee filed preliminary objections to Appellant’s
counterclaim alleging that Appellant’s counterclaim did not present claims
pertaining to the “creation” of the mortgage, and thus, it should be stricken
under Pa.R.C.P. 1148. Alternatively, Appellee alleged the counterclaim
should be stricken since the foreclosure action is strictly in rem and
Appellant’s claim for monetary damages was improper.
Appellant filed a pro se answer to Appellee’s preliminary objections.
Therein, Appellant alleged that her claim of fraud in the inducement
pertained to the creation of the mortgage. She also sought an “award of
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damages...for the necessity of defending the frivolous preliminary objections
in...an amount equal to reasonable attorney’s fess as if [Appellant] was an
attorney.” Appellant’s Answer to Appellee’s Preliminary Objections, filed
8/21/14.
By order filed on November 10, 2014, the trial court denied Appellee’s
preliminary objections and denied Appellant’s request for attorney’s fees in
defending the preliminary objections. Thereafter, on November 25, 2014,
Appellee filed a reply to Appellant’s counterclaim, noting therein that
Appellant admitted in her answer and new matter that she was in default of
the mortgage and living in the subject property without paying the
mortgage, taxes, or insurance since November 2007.
On May 7, 2015, Appellee filed a motion for summary judgment, along
with a supporting brief, averring that Appellant’s chronic failure/refusal to
make payments constituted a default of the mortgage. Appellee attached to
its motion the pre-foreclosure notice of intention to foreclose and the
Homeowner’s Emergency Mortgage Assistance forms, which were sent to
Appellant. Appellee averred that Appellant failed to cure the default, and
her responsive filings in the within matter were dilatory and designed solely
to delay. Moreover, Appellee argued that, under Pennsylvania law, it was
permitted to seek attorney’s fees at five percent of the principal balance of
the delinquent mortgage loan. Simply put, Appellee argued that Appellant
had no viable defenses to the action, and Appellant’s counterclaim was
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inappropriate in this in rem matter. Accordingly, Appellee argued that there
are no genuine issues of material fact and it is entitled to judgment as a
matter of law.
On June 4, 2015, Appellant filed a pro se response, along with a
supporting memorandum, to Appellee’s motion for summary judgment.
Therein, she averred generally that there was a genuine issue of material
fact as to whether “the obligation to make monthly mortgage payments was
the product of fraud which included fraud in the inducement and predatory
lending[.]” Appellant’s Response to Summary Judgment Motion, filed 6/4/15,
at 1. She alleged that there was a genuine issue of material fact as to
whether “her inability to make payments on the highly inflated interest and
principal as a result of the fraud in [the] inducement and predatory lending
on the part of [Appellee’s] predecessor...renders the allegation of default
false[.]” Id. at 2. Additionally, Appellant averred there was a genuine issue
of material fact as to whether the misrepresentations made by Appellee’s
predecessor, and the high interest rate on the mortgage, “doomed”
Appellant “to fail based upon her income.” Id. at 3. Appellant argued that
there was a genuine issue of material fact as to whether Appellee was not
entitled to attorney’s fees as it had acted in bad faith in instituting the
mortgage foreclosure action as “a result of fraudulent and predatory
lending[.]” Id. at 5.
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By order entered on July 15, 2015, the trial court granted Appellee’s
motion for summary judgment and decreed that judgment was entered in
favor of Appellee in the amount of $655,218.18, plus interest. The trial
court noted that “any additional recoverable costs and charges collectible
under the subject mortgage [ ] shall also be added to this judgment.” Trial
Court’s Order, filed 7/15/15. The trial court dismissed Appellant’s
counterclaim with prejudice.
On August 14, 2015, Appellant filed a timely, pro se notice of appeal,
and on August 20, 2015, Appellee filed a praecipe for the entry of judgment
in the amount of $673,596.84, which included the summary judgment
amount of $655,218.18, and accrued interest from February 12, 2015, to
August 17, 2015, in the amount of $18,378.66. The trial court did not direct
Appellant to file a Pa.R.A.P. 1925(b) statement, and consequently, no such
statement was filed. On September 3, 2015, the trial court filed an opinion
in support of its July 15, 2015, order.
Appellants presents the following issue sole issue, which we set forth
verbatim:
1. Did the Learned Trial Judge abuse her discretion and commit
error by granting the Motion for Summary Judgment filed by
[Appellee] when there were genuine issues of material fact
concerning fraud in the inducement[?]
Appellant’s Brief at 3.
On appeal, Appellant contends the trial court erred in entering
summary judgment in favor of Appellee as there were genuine issues of
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material fact concerning fraud in the inducement. To this end, Appellant
contends there is evidence she was “fraudulently induced into entering [the]
mortgage loan with [Appellee’s] predecessor in interest,” including
fraudulent misrepresentations made by the lender regarding Appellant’s
ability to repay. Appellant’s Brief at 5. She further argues that the trial
court erred in entering an order granting summary judgment where
discovery was not complete and where, if given more time, she could have
demonstrated there was a genuine issue of material fact as to her defense
as asserted in her counterclaim. Specifically, she claims that additional
discovery would have shown the “identity of the individual(s) who made the
false statements and induced [Appellant] to sign a mortgage for
$315,000.00[.]” Id. at 10.
Initially, we note we review a challenge to the entry of summary
judgment as follows:
[We] 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. See Pa.R.C.P., Rule 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 nonmoving party, and
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all doubts as to the existence of a genuine issue of material fact
must be resolved against the moving party.
E.R. Linde Const. Corp. v. Goodwin, 68 A.3d 346, 349 (Pa.Super. 2013)
(quotation omitted).
The holder of a mortgage has the right, upon default, to bring a
foreclosure action. Cunningham v. McWilliams, 714 A.2d 1054, 1056–57
(Pa.Super. 1998). The holder of a mortgage is entitled to summary
judgment if the mortgagor admits that the mortgage is in default, the
mortgagor has failed to pay on the obligation, and the recorded mortgage is
in the specified amount. Id. See Gateway Towers Condominium Ass’n
v. Krohn, 845 A.2d 855, 858 (Pa.Super. 2004) (holding a trial court
properly grants summary judgment in a mortgage foreclosure action “where
the defendant[/mortgagor] admits that he [ ] failed to make the payments
due and fails to sustain a cognizable defense to the plaintiff’s claim”)
(citation omitted)).
In finding there was no genuine issue of material fact, and Appellee
was entitled to judgment as a matter of law, the trial court set forth the
following analysis in its opinion:
In her Answer to [Appellee’s] Complaint in Mortgage
Foreclosure, [Appellant] conceded that “the mortgage payments
have not been made for a considerable [ ] period of time.” See
Answer, New Matter and Counterclaim to Complaint for Mortgage
Foreclosure. Specifically, the printed payment history of the
loan demonstrates that [Appellant] has not paid her mortgage
for over SEVEN YEARS. It was th[e] [trial] court’s conclusion
that [Appellee] proved its damages through the Affidavit in
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Support of [Appellee’s] Motion for Summary Judgment and the
payoff calculation related to the loan.
Trial Court Opinion, filed 9/3/15, at 3 (emphasis in original).
On appeal, Appellant does not dispute that Appellee demonstrated the
requisite elements set forth in Cunningham, supra. Rather, she contends
that the trial court erred in entering an order granting summary judgment
where the parties were still engaged in discovery and where, if given more
time, she could have demonstrated there was a genuine issue of material
fact concerning her defense of fraud in the inducement as asserted in her
counterclaim. In rejecting this claim, the trial court indicated the following:
In her Answer to Motion for Summary Judgment,
[Appellant] included an Affidavit in which she again maintained
that she was induced to sign the mortgage by [Appellee’s]
predecessor in interest. She then claimed she has not been able
to engage in discovery but also alleged she requires a significant
amount of documentation to prove [Appellee’s] [alleged] scheme
and predatory lending practices.
Counterclaims in mortgage foreclosure actions are only
permissible if they arise from the same transaction from which
the plaintiff’s cause of action arose. Pa.R.C.P. 1148; Green
Tree Consumer Discount Co. v. Newton, 909 A.2d 811, 814
(Pa.Super. 2006). Fraud in the inducement[1] is a recognizable
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1
The elements of fraud in the inducement are as follows:
(1) a representation; (2) which is material to the transaction at
hand; (3) made falsely, with knowledge of its falsity or
recklessness as to whether it is true or false; (4) with the intent
of misleading another into relying on it; (5) justifiable reliance
on the misrepresentation; and (6) the resulting injury was
proximately caused by the reliance.
Eigen v. Textron Lycoming Reciprocating Engine Div., 874 A.2d 1179,
1185 (Pa.Super. 2005) (quotation marks and quotation omitted).
(Footnote Continued Next Page)
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counterclaim, [in a foreclosure action provided it alleges fraud
that is part of or incident to the creation of the mortgage itself].
Cunningham, [supra]. However, a defendant bears the burden
of proving [her] counterclaim. A court may determine there are
no genuine issues of material fact (and consequently grant a
motion for summary judgment) when a defendant does not meet
[her] burden of defending against the allegations alleged by
plaintiff or move forward by proving [her] counterclaim.
On December 24, 2014, [Appellee] served [Appellant] with
discovery requests consisting of Requests for Admissions,
Interrogatories, and Request for Production of Documents.
[Appellant] failed to respond to both the Interrogatories and
Request for Production of Documents. See [Appellee’s] Exhibit
10 to [Appellee’s] Motion for Summary Judgment. Since there
was no response by [Appellant], [Appellee] (and the court) could
only conclude that there is no evidence in existence to support
the averments in [Appellant’s] pleadings. Moreover, [Appellant]
did absolutely nothing to secure and produce evidence of the
allegations contained within her counterclaim since the [trial
court] ruled upon [Appellee’s] preliminary objections and allowed
[Appellant’s] counterclaim to move forward. In her answer to
[Appellee’s] Motion for Summary Judgment, [Appellant] now
alleges she “intends to promulgate interrogatories and request
for production of documents to [Appellee],” almost one year
after the [trial court] ruled on [Appellee’s] preliminary objections
and allowed [Appellant’s] counterclaim to move forward.
Instead of attempting to prove her claims by engaging in
discovery, [Appellant] continues to file rote allegations against
[Appellee]. After living in a house rent-free for over seven
years, it is evident that [Appellant] has absolutely no motivation
to move this case forward. It is [the trial court’s] belief that
[Appellee’s] Affidavit, the payment history of the loan, and
[Appellant’s] discovery responses demonstrate not only a lack of
genuine issue of material fact but also [Appellant’s] lack of
evidence to support her averments. [Appellant] provided no
demonstrative evidence to contradict that which was submitted
by [Appellee].
_______________________
(Footnote Continued)
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Trial Court Opinion, filed 9/3/15, at 3-4 (citations omitted) (emphasis in
original) (footnote added).
We find no error in this regard. Assuming, arguendo, Appellant is
correct that the trial court granted summary judgment prior to the formal
close of discovery, this was not error. Pa.R.C.P. 1035.2 provides that a
party may move for summary judgment at any time whenever there is no
genuine issue of material fact as to a necessary element of the cause of
action or defense which could be established by additional discovery, or after
the completion of discovery relevant to the motion.
As the trial court noted, with regard to discovery, Appellant had ample
time to engage in discovery relevant to the case, defenses, and issues.
Moreover, aside from bald assertions, Appellant makes no meaningful
argument as to the materiality of the information sought.
Appellant lived rent free by refusing to make the mortgage payments
for over seven years. Clearly, the trial court did not abuse its discretion in
granting summary judgment in favor of Appellee despite the fact that
discovery had not closed. See, e.g., Reeves v. Middletown Athletic
Ass’n, 866 A.2d 1115 (Pa.Super. 2004) (indicating that a motion for
summary judgment was not premature where the opposing party had ample
time to conduct discovery, failed to do so, and did not demonstrate
additional discovery would reveal material information).
Affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/25/2017
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