Bank of America v. Frappier, V.

J-A04015-15
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
BANK OF AMERICA, N.A., AS IN THE SUPERIOR COURT OF
SUCCESSOR BY MERGER TO BAC HOME PENNSYLVANIA
LOANS SERVICING, LP F/K/A
COUNTRYWIDE HOMES LOANS
SERVICING, LP,
Appellee
v.
VALERIE J. FRAPPIER,
Appellant No. 799 WDA 2014
Appeal from the Judgment Entered April 18, 2014
In the Court of Common Pleas of Allegheny County
Civil Division at No(s): MG-13-000704
BEFORE: BOWES, OLSON, and STRASSBURGER,* JJ.
MEMORANDUM BY BOWES, J.: FILED MARCH 10, 2015
Valerie J. Frappier appeals from the trial court’s grant of Bank of
America’s motion for summary judgment in this mortgage foreclosure action.
We affirm.
Bank of America filed a complaint in mortgage foreclosure on April 30,
2013. Therein, it averred that Appellant had executed a mortgage with
Howard Hanna Financial Services, Inc., on December 7, 1998, which was
recorded. According to Bank of America, the mortgage was re-recorded on
January 19, 1999. Thereafter, the mortgage was assigned to Countrywide
____________________________________________
*
Retired Senior Judge assigned to the Superior Court.
J-A04015-15
Home Loans, Inc., (“Countrywide”) and recorded on February 4, 1999. Bank
of America noted that it was now the mortgagee and the mortgage and
assignments were matters of public record.
In addition, Bank of America submitted that it was the successor by
merger to Countrywide, and possessed the promissory note on the property
in question: 1420 4th Street, Natrona Heights, Pennsylvania. Bank of
America maintained that Appellant had failed to make any mortgage
payments since September 1, 2012, and Appellant owed $38,546.21 on the
mortgage. Bank of America also alleged that it had provided notice of its
intent to foreclose and notice of default.
Appellant filed an answer and affirmative defenses on May 28, 2013.
She admitted that she executed the mortgage in question on December 7,
1998, but entered general denials to both the averment that her mortgage
was in default and as to the amount owed. Appellant also countered that
Bank of America had not provided proof that it was the owner or holder of
the mortgage. Further, she asserted that Appellant violated the Truth-in-
Lending Act by not delivering to her two copies of a notice of the right to
rescind. Appellant continued that Bank of America violated the Real Estate
Settlement Procedure Act by failing to provide her with an annual escrow
disclosure statement for her mortgage. Finally, Appellant posited that Bank
of America’s claims were barred by the doctrine of unclean hands.
-2-
J-A04015-15
Bank of America filed a response to Appellant’s affirmative defenses on
June 28, 2013. Subsequently, Bank of America filed a motion for summary
judgment on October 1, 2013. Therein, it reiterated the basis for its
complaint and attached copies of the Note and the recording of the
assignments with the Allegheny County Office of the Recorder. According to
the motion, Appellant’s last payment was made on August 28, 2012, and she
remained in default.
Bank of America indicated that it had provided Appellant with notice of
intent to foreclose and attached a redacted copy of that notice. Additionally,
Bank of America argued that Appellant had admitted executing the mortgage
in question and, by her general denials that she was in default and the
amounts due, she had admitted those facts.
Appellant filed a motion to dismiss the complaint and a motion in
opposition to Bank of America’s motion for summary judgment on October
28, 2013. Appellant claimed, for the first time, that Bank of America lacked
standing and had not provided proof of injury. According to her, Bank of
America was not a real-party-in-interest and had not shown that her loan
was in default. Lastly, Appellant averred that the promissory note was
unenforceable because it was sold to Fannie Mae without the mortgage.
Thereafter, Appellant filed a motion to compel discovery on November
19, 2013. Bank of America responded to Appellant’s interrogatories and
request for production of documents. It further filed a response to
-3-
J-A04015-15
Appellant’s motion to dismiss on December 11, 2013. On February 12,
2014, Bank of America filed amended supplemental objections and
responses to Appellant’s discovery requests. Bank of America also
submitted a supplemental brief in support of its motion for summary
judgment on February 20, 2014, to which Appellant responded on March 13,
2014. The court held oral argument on the motion on April 17, 2014. The
following day, the court granted Bank of America’s motion for summary
judgment and it denied Appellant’s motion to dismiss on April 21, 2014.
This timely appeal followed. The court directed Appellant to file and
serve a Pa.R.A.P. 1925(b) concise statement of errors complained of on
appeal. Appellant complied, and the trial court authored an opinion in
support of its decision. Appellant now raises ten questions for our review.
1. Whether Defendant, as a pro se litigant in a foreclosure
action, has the right to due process of law. This question was
not dealt with directly by the trial court; however, the fact
that Defendant was denied discovery and the ability to defend
against loss of property indicates the lack of due process.
2. Whether summary judgment should have been denied
because discovery had not been completed and there were
and are numerous material issues of fact that have not been
resolved. The court granted summary judgment despite the
Pennsylvania Rules of Civil Procedure and case law dictating
that summary judgment be decided after discovery, only
where no genuine issues remain in a light most favorable to
the non-moving party.
3. Whether the Defendant, pursuant to 13 Pa.C.S. § 3501(b)(2),
has the right to demand reasonable evidence of authority to
file the foreclosure compliant. Defendant was denied this
right.
-4-
J-A04015-15
4. Whether Defendant, pursuant to 13 Pa.C.S §§ 3203(b) and
3203(d), had the right to demand what rights, if any, Plaintiff
has to enforce the Note. This right was denied.
5. Whether the May 7, 2013 assignment of mortgage to Bank of
America is a fraudulent assignment since, pursuant to 12 CFR
Part 226.39(d), no notice of a transfer of ownership of the
loan was given. The trial court ignored this issue.
6. Whether pursuant to Pennsylvania Statutes, 21 P.S. § 351,
previous assignments of the mortgage were not recorded in
the County Recorder’s Office, irreparably clouding the title
and obscuring the real party in interest. The trial court
ignored this issue.
7. Whether, pursuant to 12 CFR Part 226.39(a)(1), Bank of
America, as servicer of the loan, has fraudulently claimed to
hold title to the loan. The trial court ignored this issue.
8. Whether Plaintiff’s claims of rights to the Defendant’s note
and mortgage is in violation of the Consumer Credit
Protection Act, 15 U.S. § 1641(f). The trial court ignored this
issue.
9. Whether Plaintiff has established the constitutional minimum
requirement of establishing an injury upon which the Court
can grant relief. The trial court ignored this issue.
10. Whether the Order and Opinion entered in the lower court
based on erroneous facts is null and void.
Appellant’s brief at 2-3.
Our review of an order granting a motion for summary judgment is
settled. This Court reviews a trial court’s grant of summary judgment under
an abuse of discretion standard. Bank of America, N.A. v. Gibson, 102
A.3d 462, 464 (Pa.Super. 2014). In conducting this review, we view the
record in the light most favorable to the nonmoving party. Id. In addition,
our scope of review is plenary. Id.
-5-
J-A04015-15
“A party bearing the burden of proof at trial is entitled to summary
judgment ‘whenever there is no genuine issue of any material fact as to a
necessary element of the cause of action or defense which could be
established by additional discovery or expert report.’” Id.; Pa.R.C.P.
1035.2(1). Of course, “the nonmoving party cannot rest upon the pleadings,
but rather must set forth specific facts demonstrating a genuine issue of
material fact.” Id.; Pa.R.C.P. 1035.3.
“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. at 465. Moreover, it is well-established that general
averments in the nature of a denial constitute an admission in a mortgage
foreclosure action when the mortgagor would necessarily have sufficient
information to know if the allegations relative to the mortgage are true. See
First Wisconsin Trust Co. v. Strausser, 653 A.2d 688 (Pa.Super. 1995).
Appellant’s initial position regarding due process is not developed in
her brief.1 Further, as Bank of America points out, the issue was raised for
the first time in Appellant’s Rule 1925(b) statement. Accordingly, her claim
____________________________________________
1
We note that Appellant’s brief does not comply with Pa.R.A.P. 2119, insofar
as her arguments do not precisely correspond with the issues raised in her
statement of questions. Instead, Appellant’s arguments proceed without
regard to the precise formulation of her issue statement questions. We
address Appellant’s arguments in the order presented rather than via her
statement of issues.
-6-
J-A04015-15
is waived. See Pa.R.A.P. 302(a); Burgoyne v. Pinecrest Community
Ass'n, 924 A.2d 675, 680 n.4, n.6 (Pa.Super. 2007) (failure to develop
argument results in waiver). We add that the position is frivolous. Due
process requires notice and an opportunity to be heard. Fiore v. Bd. of
Fin. & Revenue, 633 A.2d 1111, 1114 (Pa. 1993). Appellant was provided
ample notice and opportunities to present her case below.
The second claim Appellant levels is that summary judgment was
improper because discovery was allegedly not complete and material issues
of fact existed. The issues of fact relate to her remaining claims. Thus, we
address those issues separately and presently confront her discovery
position. Appellant maintains that discovery was outstanding on her motion
to compel discovery. Bank of America replies that it had responded to
Appellant’s discovery request and that her motion to compel discovery was
moot.
Appellant does not indicate what discovery was outstanding. The
record shows that Bank of America provided discovery to Appellant via
responses to her interrogatories, request for admissions and production of
documents. Appellant does not indicate in any manner how the discovery
response was inadequate or what discovery was lacking that could establish
a material issue of fact. Appellant’s position is meritless.
-7-
J-A04015-15
Next, Appellant maintains that Bank of America did not establish that
it is the real party in interest. Citing solely 13 Pa.C.S. § 3501(b)(2)(ii),2
Appellant argues that Bank of America did not show that it was collecting the
mortgage on its own or for another party. In its complaint, Bank of America
averred that it “is now the mortgagee and is in the process of formalizing an
assignment of the same.” Bank of America Complaint, Paragraph 3. This
language sufficiently placed Appellant on notice of its prima facie claim to
the mortgage. See US Bank N.A. v. Mallory, 982 A.2d 986,
994 (Pa.Super. 2009); compare Wells Fargo Bank, N.A. v. Lupori, 8 A.3d
919 (Pa.Super. 2010). The assignment of the mortgage to Bank of America
was attached as an exhibit to its motion for summary judgment. A
mortgagee is a real party in interest. Mallory, supra at 994 n.6; Lupori,
supra at 922 n.3. Bank of America is the mortgagee of record. Appellant’s
failure to marshal any support for her position aside from a boilerplate
citation to a statute is also fatal.
____________________________________________
2
13 Pa.C.S. § 3501(b)(2)(ii) provides:
(2) Upon demand of the person to whom presentment is made,
the person making presentment must:
... .
(ii) give reasonable identification and, if presentment is made on
behalf of another person, reasonable evidence of authority to do
so;
-8-
J-A04015-15
Appellant also asserts that Bank of America originally denied that the
mortgage was owned by Fannie Mae REMIC trust, and that the trustee of
REMIC had not declared her mortgage in default. She then maintains that
Bank of America subsequently admitted that Fannie Mae REMIC is the owner
of the loan, declared it in default, and contracted with Bank of America to
foreclose. According to Appellant, if Fannie Mae REMIC is not the owner of
the mortgage, then Bank of America cannot demand payment on its behalf.
The record indicates that Bank of America consistently indicated to
Appellant via letters in response to her inquiries that Fannie Mae REMIC was
the owner of the note corresponding with her mortgage. However, in a
response to an interrogatory as to whether that entity owned the note, Bank
of America originally denied that Fannie Mae REMIC was the owner of the
note and stated only that Bank of America was the holder of the note. Bank
of America subsequently clarified that Fannie Mae REMIC is the owner of the
note in an amended response to Appellant’s discovery requests. It also
maintained in its supplemental brief in support of its motion for summary
judgment that, as the holder of the note, it was entitled to enforce it. We
agree.
There is no genuine issue of fact that Fannie Mae REMIC is the owner
of the note, since Bank of America corrected its original answer to
Appellant’s interrogatory. Bank of America is the holder of the note. See
Bank of America Motion for Summary Judgment, Exhibit B. The note is
-9-
J-A04015-15
endorsed in blank. See 13 Pa.C.S. § 3205. The holder of a promissory note
related to a mortgage may enforce that note since the note is a negotiable
instrument. See 13 Pa.C.S. 3104; 13 Pa.C.S. § 3301; 13 Pa.C.S. § 3205(b).
Accordingly, Bank of America could enforce the note. See J.P. Morgan
Chase Bank, N.A. v. Murray, 63 A.3d 1258 (Pa.Super. 2013) (mortgagee
who holds note is entitled to enforce it).
Next, Appellant maintains that a fraudulent assignment occurred. She
questions where the record of various assignments are and maintains that
Countrywide fraudulently assigned her mortgage to Bank of America
because Countrywide no longer had any interest in the mortgage. Relatedly,
she posits that there is no evidence that the note was assigned to Bank of
America and that Pennsylvania’s recording laws were violated.
Bank of America counters that Appellant did not raise any issue
regarding prior assignments not being recorded. It adds that the
assignment of mortgage to Countrywide was recorded on February 4, 1999,
in the Department of Real Estate in Allegheny County. Bank of America
continues that the mortgage was then assigned to it, with that assignment
being recorded on May 7, 2013.
We agree with Bank of America that there is no issue relative to the
assignment of the mortgage in this case. Concomitantly, since the
assignment of the mortgage to Bank of America has been recorded,
Appellant’s position that the failure to record such an assignment clouds the
- 10 -
J-A04015-15
title and obscured the real party in interest is frivolous. See also Mallory,
supra at 994 (“contrary to Appellant's suggestion, the recording of an
assignment of the mortgage was not a prerequisite to Appellee having
standing to seek enforcement of the mortgage via a mortgage foreclosure
action.”). Equally important, any alleged defects in the chain of assignments
does not affect the right of a mortgagee to enforce the note. See Murray,
supra at 1266.
Appellant also argues that “Bank of America falsely claims to be a
‘holder in due course.’” Appellant’s brief at 13. She asserts that, because
Bank of America acquired the mortgage after she allegedly defaulted on the
mortgage, Bank of America cannot be a holder in due course. Bank of
America replies that it “is the holder of note endorsed in blank, as further
supported in the affidavit attached to the [motion for summary judgment],
and therefore has authority to enforce the same.” Bank of America’s brief at
20. We have already concluded that the record establishes that Bank of
America is the holder of the note in question. See also Murray, supra
(discussing definition of holder in due course).
Appellant confuses the date of the recorded assignment as the date
that Bank of America came into possession of the mortgage and note.
Instantly, Bank of America came into possession of the mortgage and note
as the result it being a successor by merger with Countrywide. This
- 11 -
J-A04015-15
occurred in 2008, well before Appellant defaulted in 2012. Appellant’s
position is meritless.
In leveling the next aspect of her argument, Appellant contends that,
even if Bank of America is the holder of the note, it cannot enforce the note
without establishing who the owner of the mortgage and note is. She
maintains that Bank of America did not prove that it has any right to enforce
the note. We find this argument meritless.
As this Court recently reiterated, “[o]wnership of the Note is irrelevant
to the determination of whether [an entity] is a ‘person entitled to enforce’
the Note[.]” PHH Mortgage Corp. v. Powell, 100 A.3d 611, 621
(Pa.Super. 2014). As previously outlined, a mortgagee is a real party in
interest in a foreclosure action and as the holder of the note and mortgage
can enforce the note. Bank of America’s motion for summary judgment
established that it is the mortgagee and possesses the note at issue.
Appellant has defaulted on her payments. Bank of America was entitled to
foreclose. Appellant’s related position, that Bank of America only services
her loan and is not a real party in interest, fails for reasons already outlined.
Appellant also absurdly states that Bank of America did not allege an
injury in its complaint. Bank of America unequivocally provided that
Appellant was in default on her mortgage, provided the amount due and
owing, and demanded judgment for that amount. In addition, it set forth
- 12 -
J-A04015-15
that it was the mortgagee and possessor of the note. Appellant’s position is
wholly frivolous.
The penultimate contention Appellant makes is that she did not receive
notice of transfer of the ownership of her loan, which she maintains calls into
question the assignments in this matter. For reasons discussed previously,
relative to ownership and assignments, this claim is meritless.
The final claim Appellant posits is that the trial court opinion is
premised on erroneous facts. Since we have found that Bank of America is
the mortgagee, possesses the note on Appellant’s home, and Appellant’s
earlier issues are untenable, she is entitled to no relief. The record discloses
that Appellant is in default on her mortgage. Her general denials as to her
default and the amount owed are admissions. Strausser, supra. A
mortgage holder 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.” Gibson,
supra at 465. The trial court did not err in awarding summary judgment.
Judgment affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 3/10/2015
- 13 -