Funk, J. v. Bradley, C.

J-A11004-20
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JORDAN FUNK, MICHAEL RESSLER, : IN THE SUPERIOR COURT OF
AND BRIAN RESSLER : PENNSYLVANIA
:
:
v. :
:
:
CHRISTY L. BRADLEY :
: No. 1771 MDA 2019
Appellant :
Appeal from the Order Entered October 1, 2019
In the Court of Common Pleas of Lancaster County
Civil Division at No(s): CI-18-01146
BEFORE: PANELLA, P.J., McLAUGHLIN, J., and STEVENS, P.J.E.
MEMORANDUM BY PANELLA, P.J.: FILED: JUNE 8, 2020
Christy Bradley appeals from the order entered in the Court of Common
Pleas of Lancaster County, which denied her petition to set aside the sheriff’s
sale of a property on Pinch Road, Manheim, Lancaster County, Pennsylvania
(“the Property”). Following extensive review, we affirm.
Bradley obtained a mortgage on the Property from Jordan Funk, Michael
Ressler, and Brian Ressler (collectively, “the Appellees”). As identified in the
mortgage’s corresponding note, in exchange for a loan amount of $200,000,
Bradley agreed to an interest rate of 15% per annum and a monthly payment
of $2,500. Shortly thereafter, the mortgage was recorded at the Office of the
Recorder of Deeds in Lancaster County.
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 Former Justice specially assigned to the Superior Court.
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Less than one year after the mortgage’s execution, Appellees filed their
complaint in mortgage foreclosure, alleging that Bradley failed to make the
required payments under the note. The Appellees sought the mortgage’s
principal amount, the amount that Bradley had failed to pay under the monthly
payment scheme, all additional available charges collectible under the note
and mortgage, and attorney’s fees.
Although she was properly served, Bradley did not respond to Appellees’
complaint. Eventually, a default judgment was entered in favor of the
Appellees in the amount of $238,092.18. Thereafter, Appellees filed a praecipe
for writ of execution on the judgment, which was issued. Additionally, a notice
of sheriff’s sale and corresponding affidavit were filed, and in that notice, a
date was set for the Property’s sale. A subsequent notice of sheriff’s sale was
also filed, but maintained the same sale date. At the sheriff’s sale, the
Appellees purchased the Property.
Approximately one month later, Bradley filed a petition to set aside the
sheriff’s sale alleging various notice- and delivery-based defects. Furthermore,
Bradley contested the upset bid price predicated on: 1) her assertion that the
interest rate contained within the note was a product of fraud; 2) her being
saddled with exorbitant attorney’s fees; 3) Appellees and the court failing to
take into account money she had previously paid to the Appellees.
Upon the petition’s submission, the trial court issued a rule to show
cause, Appellees filed an answer, and both parties had the opportunity to
extensively brief their respective positions. Ultimately, the court denied
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Bradley’s petition. In response, Bradley filed a timely notice of appeal. At the
trial court’s direction, Bradley filed a timely Pa.R.A.P. 1925 statement of
matters complained of on appeal. Afterward, the trial court issued its Pa.R.A.P.
1925 opinion, largely relying on the opinion affixed to its initial order denying
Bradley’s petition. Accordingly, the appeal is properly before this Court.
Bradley poses the following question for our review:
1) Did the trial court err as a matter of law in denying Bradley’s petition
to set aside the sheriff’s sale when 1) the sheriff’s sale featured
insufficient notice and 2) at least one element of the mortgage and
note were obtained by way of fraud?
See Appellant’s Brief, at 4, 10, 12.
The intended purpose of a sheriff’s sale in a mortgage foreclosure
proceeding is to realize the debt, interest, and costs due to the judgment
creditor. See Merrill Lynch Mortg. Capital v. Steele, 859 A.2d 788, 792
(Pa. Super. 2004). Nevertheless, “[a] sale may be set aside upon petition of
an interested party where upon proper cause shown the court deems it just
and proper under the circumstances.” Id. (citation and internal quotation
marks omitted).
“A petition to set aside a sheriff's sale is grounded in equitable principles
and is addressed to the sound discretion of the hearing court.” GMAC Mortg.
Corp. of Pa. v. Buchanan, 929 A.2d 1164, 1167 (Pa. Super. 2007).
The burden of proving circumstances warranting the exercise of
the court's equitable powers rests on the petitioner, as does the
burden of showing inadequate notice resulting in prejudice, which
is on the person who seeks to set aside the sale. When reviewing
a trial court's ruling on a petition to set aside a sheriff's sale, we
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recognize that the court's ruling is a discretionary one, and it will
not be reversed on appeal unless there is a clear abuse of that
discretion.
Id. (citation omitted).
“An abuse of discretion is not merely an error of judgment, but if in
reaching a conclusion the law is overridden or misapplied, or the judgment
exercised is manifestly unreasonable, or [the judgment is] the result of
partiality, prejudice, bias or ill-will, as shown by the evidence of record,
discretion is abused.” National Penn Bank v. Shaffer, 672 A.2d 326, 328
(Pa. Super. 1996). Further, even if we might have reached a different
conclusion, that determination, in isolation, is not enough to find an abuse of
discretion. See id.
Preliminarily, despite the fact that Bradley poses one question in her
brief, her argument section covers two discrete topics, notice and fraud.
Moreover, she intermingles discussion on the validity of attorney’s fees and
the court’s apparent failure to consider an amount she had already paid to
Appellees. Accordingly, her brief does not conform to the Pennsylvania Rules
of Appellate Procedure. See Pa.R.A.P. 2119(a) (providing that an “argument
shall be divided into as many parts as there are questions to be argued.”).
However, even though this deviation has hampered our review, we will
address notice and fraud in the order they appear in her brief and then
conclude with a brief discussion on the ancillary matters.
First, Bradley asserts that two of the Appellees, Michael Ressler and
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Brian Ressler, as parties in interest to the sheriff’s sale, were not notified in
accordance with Pa.R.C.P. 3129.2. Bradley is correct insofar as “[n]otice of
the sale of real property shall be given by handbills … by written notice … to
all persons whose names and addresses are set forth in the affidavit required
by Rule 3129.1.” Pa.R.C.P. 3129.2. The affidavit requires the affiant to, inter
alia, set forth the owner of the real property and “every other person” who
has any record lien, record interest, or interest that is not of record. Pa.R.C.P.
3129.1.
However, Bradley misconstrues the meaning of “every other person.”
Specifically, Bradley fails to distinguish between who is required to give notice,
and who is required to receive notice:
The notice requirements of Pa.R.C.P. 3129.1, 3129.2, and 3129.3
were intended to protect fundamental rights of due process by
insuring that persons with an interest in real estate would receive
adequate notice before being deprived of their property. Because
notice is the most basic requirement of due process, [it] must be
reasonably calculated to inform interested parties of the pending
action, and the information necessary to provide an opportunity
to present objections. The form of notice required depends on
what is reasonable considering the interests at stake and the
burdens of providing notice.
First Eastern Bank, N.A. v. Campstead, Inc., 637 A.2d 1364, 1366 (Pa.
Super. 1994) (citations and quotation marks omitted).
All three Appellees were identified as plaintiffs in the foreclosure action
against Bradley and continue to be represented by the same counsel.
Therefore, the Appellees collectively constitute affiants within the meaning of
Pa.R.C.P. 3129.1(b) and cannot additionally be other interested persons,
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which, if so, would trigger their inclusion on the affidavit as well as notice.
Accordingly, there is no requirement that any of the Appellees had to have
been specifically listed as an interested party on the affidavit or provided with
notice, even though, in fact, one was.1 See Appellees’ Brief, at 4.
At a minimum, the Appellees, as the initiators of the action against
Bradley, do not fall within the intended target of Rules 3129.1 and 3129.2 nor
do they risk being deprived of property, as they are the individuals seeking to
compel the mortgage foreclosure and sale of the Property.
As logic would dictate that Appellees/affiants cannot, too, be “every
other person” within the meaning of Rules 3129.1 and 3129.2, none of them
needed to have been included on the affidavit nor provided with corresponding
notice of that affidavit. More importantly, it strains credulity, based on the
circumstances, that all three Appellees, as bidders and the ultimate winners
of the property, were not wholly apprised of the sheriff’s sale. As such,
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1 The trial court noted that:
The Rule 3129.1 affidavit which was prepared on [Appellees’]
behalf by [Appellees’] counsel gave a single address for all
[Appellees]. This was the same mailing address given for
[Appellees] in the complaint. Counsel’s certificate of service stated
that notice of the sale was sent to that address, albeit in the name
of only one [Appellee].
Trial Court Opinion, 10/28/19, at 5 (citation omitted).
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Bradley’s first argument fails.2
Second, on the issue of fraud, Bradley avers that “[t]he terms of the
loans were changed and presented to [Bradley] at the time of closing when
she was already under duress, committed to [the] process and in need of the
loan.” Appellant’s Brief, at 8-9. In short, “the terms were not as originally
discussed.” Id., at 9.
Fraud entails the following elements: 1) a misrepresentation; 2) the
misrepresentation must be material to the transaction at hand; 3) an intent
to induce reliance; 4) justifiable reliance; and 5) damage. See Kit v. Mitchell,
771 A.2d 814, 819 (Pa. Super. 2001). Fraud “consists of anything calculated
to deceive whether by single act or combination, or by suppression of truth,
or suggestion of what is false whether it be by direct falsehood or by innuendo,
by speech or silence, word of mouth, or look or gesture.” Delahanty v. First
Pennsylvania Bank, N.A., 464 A.2d 1243, 1251 (Pa. Super. 1983) (citation
omitted). Moreover, fraud must be averred with particularity and must be
demonstrated by specific facts and not merely innuendo. See Pa. R.C.P. 1019
(b); Presbyterian Med. Ctr. v. Budd, 832 A.2d 1066, 1072 (Pa. Super.
2003).
Fraud is a basis for setting a sheriff’s sale aside. See Mortg. Elec.
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2 The trial court determined that Bradley “lacks standing to assert the lack of
notice to [Appellees] as a basis for setting aside the sale.” Trial Court Opinion,
10/28/19, at 5. While we do not expressly decide this issue, it is worth noting
that Bradley has cited nothing to refute this notion.
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Registration Sys., Inc. v. Ralich, 982 A.2d 77, 80 (Pa. Super. 2009). With
that said, mere insinuations of improprieties during the loan process are
insufficient to establish a claim of fraud. See id., at 80-81.
Bradley proclaims that she was presented with a document at the
mortgage closing that materially differed from the terms that had been
discussed and agreed to prior. See Appellant’s Brief, at 12-13. Instead of a
declining two-step interest rate, she was “surprised with documents that set
forth an interest rate of 15% for the whole term of the loan.” Id., at 13. In
addition, Bradley contends that one of the Appellees’ testimonies establishes
that “the terms at closing were not the same as what had originally been
discussed.” Id., at 14. Essentially, the only allegation of fraud is that the final
terms were distinct from some earlier iteration of the negotiated mortgage
terms, and Bradley was unaware of the change.
Assuming, arguendo, that the interest rate was not what had been
agreed upon,3 that contention, standing alone, is insufficient to ascertain
fraud. Stated differently, Bradley has failed to identify any particular facts that
could demonstrate an intent to induce her reliance through any actions
performed by the Appellees nor has she cited to any authority finding fraud in
an analogous or identical situation.
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3The trial court found Bradley’s testimony to be contradictory as to what she
believed the terms of the transaction to be in contrast with what was
presented to her in the note and mortgage at closing. See Trial Court Opinion,
10/28/19, at 7.
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Instead, Bradley was fully informed of the 15% interest rate at closing,
as evinced by her initials on each page of both the note and the mortgage and
full signature at the end of both documents. Furthermore, even taking into
account the respective bargaining positions of the parties and Bradley’s
precarious financial position, counsel represented her in connection with the
execution of the note and mortgage, and Bradley’s counsel, less than one
month prior to closing, endorsed the satisfactory nature of those two
documents.
Correspondingly, we find that Bradley was adequately apprised of the
mortgage and note’s terms and conditions and was not deceived into affixing
her name to those documents. As a result, Bradley’s second issue does not
warrant any relief.
Tangentially, Bradley asserts that the trial court failed to take into
account certain money that she had already paid to the Appellees and refutes
the court’s awarding of attorney’s fees. In summation, Bradley states that “an
$8,200 payment [she made] has been acknowledged and yet was not
considered for the purposes of the [s]heriff’s [s]ale,” and Appellees’ “attorneys
[sic] fees were presented without justification.” Appellant’s Brief, at 11.
As to what Bradley had already paid out, the trial court found that
Appellees’ attorney acknowledged receipt of an $8,200 payment made by
Bradley. See Trial Court Opinion, 10/28/19, at 9. However, other than merely
citing the intended purpose of a sheriff’s sale, Bradley cites to no authority
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indicating that a sheriff’s sale must be set aside in the event that a mortgagor
makes a payment toward the mortgage or why that would be relevant to the
sale itself. Given the discretionary nature of a petition to set aside a sheriff’s
sale and Bradley’s failure to contest any element of the foreclosure
proceedings until after a default judgment was taken, we perceive no abuse
of discretion in the trial court’s decision to deny the petition. Although her
payment does not prevent the sale of the Property, we emphasize that Bradley
is not prohibited from raising this payment in any kind of subsequent
deficiency judgment levied against her by the Appellees.
On the issue of attorney’s fees, “a mortgagee is entitled on foreclosure
to recover reasonable expenses, including attorney’s fees.” Citicorp Mortg.,
Inc. v. Morrisville Hampton Village Realty Ltd. Partnership, 662 A.2d
1120, 1123 (Pa. Super. 1995) (citation omitted). Still, those fees must be
reasonable in conjunction with the circumstances of a particular case. See id.
Here, those fees amounted to approximately 5.1% of the mortgage’s value.
Other mortgage foreclosure cases decided by our court have found attorney’s
fees set at five percent to be acceptable. See, e.g., Foulke v. Hatfield Fair
Grounds Bazaar, Inc., 173 A.2d 703, 704, 706 (Pa. Super. 1961). We see
no material difference in one-tenth of a percentage point, and other than bald
assertions, Bradley has offered nothing specific for us to conclude that the fee
is unreasonable under the particular circumstances of this case. Therefore,
Bradley’s challenge fails.
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As none of Bradley’s issues are meritorious, we affirm the trial court’s
order denying her petition to set aside the sheriff’s sale.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 06/08/2020
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