J-A28028-16

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

BAYVIEW LOAN SERVICING, LLC, IN THE SUPERIOR COURT OF

PENNSYLVANIA

Appellant

v.

CHINA L.B. RUTLEDGE,

Appellee No. 609 EDA 2016

Appeal from the Judgment Entered February 11, 2016

In the Court of Common Pleas of Philadelphia County

Civil Division at No(s): January Term 2011 No. 03691

BEFORE: PANELLA, SHOGAN, and PLATT,*JJ.

MEMORANDUM BY SHOGAN, J.: FILED DECEMBER 21, 2016

Appellant, Bayview Loan Servicing, LLC (“Bayview”), appeals from the 

judgment entered in favor of Appellee, China L.B. Rutledge (“Rutledge”) and 

against Bayview, following entry of nonsuit in this mortgage foreclosure 

action.1 We affirm.

The trial court summarized the factual and procedural history of this 

case as follows:

On January 26, 2011, Wells Fargo, N.A., as certificate 

trustee not in its individual capacity solely as certificate trustee, 

in trust for registered holders of VNT Trust Series 2010-2 (“Wells 

____________________________________________

*

 Retired Senior Judge assigned to the Superior Court.

1

 “[I]n a case where nonsuit was entered, the appeal properly lies from the 

judgment entered after denial of a motion to remove nonsuit.” Billig v. 

Skvarla, 853 A.2d 1042, 1048 (Pa. Super. 2004). 
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Fargo”), commenced this foreclosure action against [Rutledge], 

as real owner of the mortgaged property located at 2007 West 

68th Avenue, in Philadelphia (“Property”). On April 6, 1990, the 

mortgagor, Brenda E. Lewis, borrowed $36,745 from American 

Residential Mortgage Corporation (“American Residential”). 

Ms. Lewis signed a promissory note (“Note”) and secured the 

loan with a mortgage (“Mortgage”) on the property to American 

Residential. The Complaint asserts that Ms. Lewis died on 

April 1, 2000. Annie Ruth Harris, the mother and sole heir of the 

Estate of Brenda E. Lewis (“Lewis Estate”), transferred the 

Property to [Rutledge] by deed dated March 16, 2001 and 

recorded in Philadelphia County on December 24, 2001 under 

Document No. 50379562 (“Deed”). These facts concerning the 

transfer of the Property from the Lewis Estate to [Rutledge] are 

not alleged in the Complaint. Also, neither Ms. Lewis’ mother as 

heir nor the Lewis Estate are named as a defendant in the 

action.

The Complaint alleges American Residential assigned the 

Mortgage to GMAC Corporation of Iowa by assignment dated 

October 10, 1990 and recorded in Philadelphia County. The 

Complaint then lists thirteen (13) subsequent mortgage 

assignments made and recorded throughout the years. The last 

assignment listed in the Complaint was made by Vantium REO 

Capital Markets, L.P. to Wells Fargo on December 15, 2010 and 

recorded in Philadelphia County at Document No. 52294039. 

The Complaint alleges the Mortgage has been in default by 

reason of Ms. Lewis’s failure to make payments under the 

Mortgage since December 1, 1993. The Complaint attaches only 

a copy of the Property’s legal description and the Notice of 

Intention to Foreclose sent in June 2010 to Ms. Lewis, Deceased, 

and [Rutledge]. The Complaint does not attach the Mortgage, 

Note or any of the mortgage assignments. Rather, the 

Complaint simply incorporates these documents by reference, 

but does not do so pursuant to Pa.R.C.P. 1019(g).

[Rutledge] filed Preliminary Objections to the Complaint 

objecting only to the Complaint’s verification. [Rutledge] was 

represented by counsel at the time. [Wells Fargo] filed an 

Amended Complaint, to which [Rutledge] again filed Preliminary 

Objections objecting only to the verification. The Amended 

Complaint also fails to attach the Mortgage, Note or any of the 

mortgage assignments. The Preliminary Objections were 

sustained and [Wells Fargo] filed a substitute verification. 
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Thereafter, [Rutledge] filed an Answer to the Complaint 

with New Matter. [Rutledge’s] New Matter raised several 

affirmative defenses, including lack of standing. [Rutledge] 

alleged both the general defense of lack of standing and more 

detailed defenses concerning standing which attack the 

numerous mortgage assignments. The Answer with New Matter 

attached as exhibits eight (8) of the mortgage assignments. 

Wells Fargo replied to the New Matter. 

In February 2014, Wells Fargo filed a Motion to Compel 

[Rutledge’s] answers to interrogatories and requests for 

admissions. The Motion was granted and [Rutledge] was given 

thirty (30) days to respond to the discovery requests or risk 

sanctions. 

This [c]ourt later permitted [Rutledge’s] attorney to 

withdraw as counsel for [Rutledge]. [Rutledge] thereafter 

proceeded pro se.

Wells Fargo later filed a Motion for Sanctions based on 

[Rutledge’s] failure to comply with the [trial court’s] previous 

discovery order. Wells Fargo asked the [c]ourt for the requests 

for admissions to be deemed admitted and [Rutledge’s] Answer 

to the Amended Complaint [to] be stricken. An order was issued 

which granted the Motion and precluded [Rutledge] from offering 

evidence and/or testimony at trial. [The trial court] did not 

grant Wells Fargo’s specific demand for the requests for 

admissions to be deemed admitted and [Rutledge’s] Answer to 

be stricken. 

In September 2015, [Appellant], Bayview Loan Servicing, 

LLC, was substituted as Plaintiff by Praecipe based on a 

mortgage assignment from Wells Fargo dated December 3, 2013 

(“Bayview Assignment”). The copy of the Bayview Assignment 

attached to the Praecipe is not certified and has no markings 

indicating the Bayview Assignment [had] been recorded.

The action was subsequently deferred due to [Rutledge’s] 

bankruptcy. The case was removed from deferred status in July 

2015 and listed for trial. 

The matter proceeded to a bench trial on September 8, 

2015. [Bayview] was present but [Rutledge] did not appear. 

[Bayview] offered several documents to the [c]ourt as evidence, 
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including, inter alia, a certified copy of the Mortgage, the original 

Note and a copy thereof, a copy of the Bayview Assignment and 

a certified copy of the Deed. [Bayview] produced an employee 

witness, Terrance Schonleber, who testified regarding the 

documents. 

* * *

At the conclusion of [Bayview’s] case, [the trial court] 

found [Bayview] failed to establish standing based on the 

documents offered at trial. Specifically, the Note was not 

endorsed in blank and the Bayview Assignment was neither 

recorded nor certified. Accordingly, [the trial court] entered a 

nonsuit against [Bayview] and in favor of [Rutledge].

[Bayview] timely filed [a] Motion for Post Trial Relief. The 

Note, [Bayview’s] Motion to Compel and all mortgage 

assignments, including all preceding assignments not previously 

of record, were attached as exhibits. The Motion also include[d] 

a copy of the unrecorded and uncertified Bayview Assignment 

presented at trial and a copy of the Bayview Assignment with 

markings from the Philadelphia Commissioner of Records 

showing the Bayview Assignment was recorded on September 

12, 2014 at Document No. 52827574. This [was] the first time 

[Bayview] provided the [c]ourt with a copy of the recorded 

Bayview Assignment. 

On October 8, 2015, prior to [the trial court’s] ruling on 

the Motion, [Bayview] filed a direct appeal of the nonsuit with 

[this Court]. The appeal was quashed on December 4, 2015[,] 

as the Post Trial Motion had not yet been ruled on. 

Trial Court Opinion, 2/11/16, at 1-9. 

By order entered February 11, 2016, the trial court denied Bayview’s 

post-trial motion and entered judgment in Rutledge’s favor. Bayview timely 

appealed. 

Bayview presents the following issues for our review:
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1. Whether the lower Court erred in not finding that 

[Rutledge] waived the issue of standing by failing to raise it in 

either of her preliminary objections?

2. Whether the Lower Court erred in failing to find that 

[Bayview] had standing by virtue of [Rutledge’s] failure to 

respond to Requests for Admissions pursuant to Pa.R.C.P. 

4014(b).

3. Whether [Bayview] proved standing by entering the 

original Note indorsed in blank in to evidence at trial?

4. Whether assuming, arguendo, that the Court finds that the 

note was not negotiated, [Bayview] was nevertheless entitled to 

enforce the note pursuant to Section 3203(b) of the 

Pennsylvania Uniform Commercial Code (“PUCC”)?

5. Whether assuming, arguendo, the Court finds that the note 

was not negotiated, [Bayview] has standing as Mortgagee by 

assignment?

6. Whether the Assignment of the Mortgage to Bayview, 

whether or not it was recorded, demonstrates possession of the 

Note under Section 3204(c) of the PUCC.

7. Whether [Bayview] named all proper parties and released 

[Brenda E. Lewis], in accordance with Pa.R.C.P. 1144(b), giving 

the Trial Court subject matter jurisdiction over all proper parties.

Bayview’s Brief at 4-5. 

In its first claim, Bayview asserts that Rutledge waived the issue of 

standing by failing to raise it in either of her preliminary objections. 

Bayview’s Brief at 15. While Bayview acknowledges that Rutledge raised the 

issue of standing in her Answer with New Matter, it asserts that such 

pleading does not preserve the issue if it is not raised in preliminary 

objections. Id. at 16-17. Moreover, Bayview maintains that “if standing is 

contested in an answer as in this case, [Rutledge] waived the issue because 
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she was required to raise it in her first responsive pleading.” Id. at 17. 

Additionally, Bayview posits that the court cannot sua sponte raise standing 

issues. Id. at 16. 

Rule 1032 of the Pennsylvania Rules of Civil Procedure provides, inter 

alia, as follows:

Rule 1032. Waiver of Defenses. Exceptions. Suggestion 

of Lack of Subject Matter Jurisdiction or Failure to Join 

Indispensable Party

a) A party waives all defenses and objections which are not 

presented either by preliminary objection, answer or reply, 

except a defense which is not required to be pleaded under Rule 

1030(b), the defense of failure to state a claim upon which relief 

can be granted, the defense of failure to join an indispensable 

party, the objection of failure to state a legal defense to a claim, 

the defenses of failure to exercise or exhaust a statutory remedy 

and an adequate remedy at law and any other nonwaivable 

defense or objection. 

Pa.R.C.P. 1032. As this Court has held: “[t]he issue of incapacity to sue is 

waived unless it is specifically raised in the form of a preliminary objection 

or in the answer to the complaint.” Huddleston v. Infertility Center of 

America, 700 A.2d 453, 457 (Pa. Super. 1997) (emphasis added); see also 

In re Estate of Alexander, 758 A.2d 182, 189 (Pa. Super. 2000) 

(“[c]hallenges to a litigant’s capacity to sue must be raised by way of 

preliminary objections or answer.”). The term “capacity to sue” relates to 

standing. Hall v. Episcopal Long Term Care, 54 A.3d 381, 399 (Pa. 

Super. 2012). Moreover, “our Supreme Court has made clear that we may 

not question a party’s standing sua sponte.” U.S. Bank, N.A. v. Pautenis, 
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118 A.3d 386, 393 n.8 (Pa. Super. 2015) (Where trial court did not address 

standing, and it was not clear whether mortgagee had standing to bring a 

foreclosure action, this Court did not have authority to raise standing sua 

sponte because homeowner did not challenge bank’s standing to bring 

action.) 

Herein, Rutledge raised Bayview’s lack of standing in her answer and 

new matter. See Answer and New Matter, 7/4/12 at ¶ 5 (Rutledge denies 

that Bayview is the holder of the mortgage); ¶¶ 9-20 (Rutledge denies valid 

assignment of the Mortgage or Note to Bayview); ¶¶ 39-99 (“SECOND 

AFFIRMATIVE DEFENSE: LACK OF STANDING”). Thus, Bayview’s first claim 

lacks merit. Accordingly, we proceed to address the remainder of Bayview’s 

claims.

Bayview’s next five issues challenge the nonsuit entered by the trial 

court and consist of various arguments asserting that it did indeed have 

standing in this matter. 

In reviewing the entry of a nonsuit, our standard of review is 

well-established: we reverse only if, after giving appellant the 

benefit of all reasonable inferences of fact, we find that the 

factfinder could not reasonably conclude that the essential 

elements of the cause of action were established. Indeed, when 

a nonsuit is entered, the lack of evidence to sustain the action 

must be so clear that it admits no room for fair and reasonable 

disagreement.... The fact-finder, however, cannot be permitted 

to reach a decision on the basis of speculation or conjecture.

Vicari v. Spiegel, 936 A.2d 503, 509 (Pa. Super. 2007) (internal citations 

and quotation marks omitted).
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In its second issue, Bayview asserts that Rutledge is deemed to have 

admitted standing by failing to respond to Bayview’s request for admissions 

pursuant to Pa.R.C.P. 4014(b). Bayview’s Brief at 17. Specifically, Bayview 

claims that the trial court erred in failing to find that Rutledge’s failure to 

respond to the chain of mortgage assignments is deemed an admission. Id. 

Bayview further asserts that Rutledge’s failure to respond to all of the 

requests for admissions made by Bayview resulted in her admission that the 

then-plaintiff, Wells Fargo, held and possessed the mortgage at the time. 

Id. at 18-19. Morever, it asserts, Rutledge’s failure to appear at trial and 

failure to move for withdrawal of her admissions as required by Pa.R.C.P. 

4014(d) results in her admission of Bayview’s standing. Id. at 19. 

As this Court has explained:

Rule 4014 governs requests for admissions. It permits a party 

to serve upon another party a written request for the admission 

of the truth of certain matters relating to statements or opinions 

of fact or the application of the law to fact. Pa.R.C.P. 4014(a). 

This includes questions regarding the execution, correctness, 

genuineness, authenticity, signing, delivery, mailing, or receipt 

of any document described in the request for admissions. Id. 

“The purpose of this discovery tool is to clarify and simplify the 

issues raised in prior pleadings in order to expedite the litigation 

process.” Christian v. Pennsylvania Fin. Responsibility 

Assigned Claims Plan, 454 Pa.Super. 512, 686 A.2d 1, 5 

(1996) (citation omitted), appeal denied, 548 Pa. 678, 699 A.2d 

733 (1997). Unless the party responds to the request within 30 

days (45 days for a defendant), the matter is deemed admitted. 

Pa.R.C.P. 4014(b). The trial court may extend or shorten the 

timeframe in which the responding party has to answer the 

request. Id.
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Estate of Borst v. Edward Stover Sr. Testamentary Trust, 30 A.3d 

1207, 1210 (Pa. Super. 2011). 

Conclusions of law are not within the permissible scope of 

requests for admissions; requests must call for matters of fact 

rather than legal opinions and conclusions. Rule 4014 provides 

that a party may deny a request for admission that the party 

considers a genuine issue for trial. This denial, however, is 

subject to the discovery sanctions of Rule 4019(d).

Christian v. Pennsylvania Fin. Responsibility Assigned Claims Plan, 

686 A.2d 1, 5 (Pa. Super. 1996) (internal citations omitted).

In this case, Rutledge failed to respond to the requests for admission 

filed by Wells Fargo, the plaintiff at that point in the proceeding. A review of 

the requests for admission reveals that, even if all requests were deemed to 

be true, none would establish that Bayview has standing. There was no 

request for admission as to the chain of mortgage assignments in the 

document. Motion to Compel, 2/26/14, Exhibit A, Request for Admission at 

¶¶ 1-15 (two paragraphs were numbered “14”). The only request for 

admission that could arguably establish Bayview’s standing is request 

number five which provides as follows: “[Wells Fargo] currently holds and 

possesses the Note and Mortgage.” Id. at ¶ 5. 

We first note that asking Rutledge to admit or deny that Wells Fargo 

then held and possessed the Note and Mortgage is a legal question. As will 

be discussed subsequently, the determination as to whether a bank is a 

holder in due course of a note and mortgage is a legal conclusion. Thus, this 

request was for a conclusion of law and therefore not within the permissible 
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scope of requests for admissions. Christian, 686 A.2d at 5. Moreover, as 

outlined, Bayview was subsequently substituted for Wells Fargo in this 

litigation, and such admission would not in and of itself establish that 

Bayview has standing to proceed with the current action against Rutledge. 

Again, as will be discussed in greater detail in addressing Bayview’s 

additional issues related to standing, the question of whether Bayview has 

standing to proceed against Rutledge has not been established. We also 

note the trial court’s observation that Bayview did not request that the 

unanswered requests for admission be deemed admitted at trial. 

Accordingly, the trial court did not err in failing to conclude that Rutledge 

admitted to Bayview having standing in this matter as a result of Rutledge’s 

failure to respond to the request for admissions.

In its next two issues, Bayview asserts that it proved standing at trial 

by entering the original Note into evidence at trial. Bayview’s Brief at 19. 

Bayview contends that the Note is indorsed in blank and therefore Bayview’s 

possession of the Note entitles it to enforce the Note in this action. Id. at 

21-22. Accordingly, Bayview asserts, the trial court abused its discretion in 

failing to find that it had standing on this basis. Id. at 22. 

The holder of a mortgage has the right, upon default, to bring a 

foreclosure action. Bank of Am., N.A. v. Gibson, 102 A.3d 462, 464 (Pa. 

Super. 2014), appeal denied, 112 A.3d 648 (Pa. 2015). In a foreclosure 

action, the plaintiff can prove standing either by showing that it (1) 
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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, 1267-1268 and n.6 (Pa. Super. 2013).

Under the Pennsylvania Uniform Commercial Code (PUCC), the 

note securing a mortgage is a negotiable instrument. J.P. 

Morgan Chase Bank, N.A. v. Murray, 63 A.3d 1258 

(Pa.Super.2013). A note endorsed in blank is a “bearer note,” 

payable to anyone on demand regardless of who previously held 

the note. 13 Pa.C.S.A. §§ 3109(a), 3301. 

Gibson, 102 A.3d at 466; see also PHH Mortg. Corp. v. Powell, 100 A.3d

611, 621 (Pa. Super. 2014) (“Evidence that some other entity may be the 

“owner” or an “investor” in the Note is not relevant to this determination, as 

the entity with the right to enforce the note may well not be the entity 

entitled to receive the economic benefits from payments received thereon.”). 

The Pennsylvania Uniform Commercial Code (“PUCC”) defines a blank 

indorsement as follows: “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.” 13 

Pa.C.S. § 3205(b). A special indorsement is defined as follows: “If an 

indorsement is made by the holder of an instrument, whether payable to an 

identified person or payable to bearer, and the indorsement identifies a 

person to whom it makes the instrument payable, it is a ‘special 

indorsement.’ When specially indorsed, an instrument becomes payable to
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the identified person and may be negotiated only by the indorsement of that 

person.” 13 Pa.C.S. § 3205(a). 

Bayview presented the Note at trial. The trial court provided the 

following summary regarding the Note:

The Note is dated April 6, 1990 and states the original loan 

amount of $36,745. The Note is in the name of the original 

lender, American Residential [Mortgage Corporation], and Ms. 

Lewis is the named borrower. The Note is a [two]-page 

document which contains a blank indorsement from GMAC 

Mortgage Corporation [of Iowa] at the bottom of the page. The 

indorsement is made by the Assistant Vice President, C. Tann. 

Several allonges[2]are included with the Note. The first 

allonge after the Note is date[d] April 1, 1997 and is specially 

endorsed to the order of Berkeley Federal Bank & Trust FSB from 

the U.S. Department of Housing and Development (“HUD”) by its 

attorney-in-fact of Berkeley Federal Bank & Trust FSB. The 

indorsement is made by the Director of Mortgage Operations, 

Donald L. St. John. The allonge lists a loan number, the Note’s 

execution date and names Ms. Lewis as the borrower.

The following allonge is date[d] May 1, 1997 and is 

specially endorsed to the order of Girard Savings Bank, FSB from 

Ocwen Federal Bank FSB, f/k/a Berkeley Federal Bank & Trust 

FSB. The indorsement is made by the Director of Mortgage 

Operations, Donald L. St. John. The allonge lists a loan number, 

the Note’s execution date and names Ms. Lewis as the borrower.

The next allonge is not dated, but includes a loan number 

and names Ms. Lewis as the borrower. The allonge contains a 

special endorsement to the order of WMFC 1997-4 Inc. a 

Delaware Corporation from First Bank of Beverly Hills, FSB, 

formerly known as Girard Savings Bank, FSB. The indorsement 

____________________________________________

2

 An allonge is “[a] slip of paper sometimes attached to a negotiable 

instrument for the purpose of receiving further indorsements when the 

original paper is filled with indorsements.” Black’s Law Dictionary 88 (9th 

ed. 2009).
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is made by Senior Vice President, Chief Credit Officer, 

William Schack.

The subsequent allonge is also not dated, but includes a 

loan number and names Ms. Lewis as the borrower. The allonge 

is specially endorsed to Ocwen Federal Bank FSB by WMFC 

1997-4 Inc. a Delaware Corporation. The indorsement is made 

by June Fogg, authorized signor.

The next allonge is dated May 18, 2001 and contains a 

special endorsement to the order of Franklin Credit Management 

Corporation from Ocwen Federal Bank FSB. The allonge lists a 

loan number, the Note’s execution date, the Note amount and 

names Ms. Lewis as the borrower.

The following allonge contains a special endorsement [to] 

Sky Bank [from] Tribeca Loan Corporation. It is not dated and 

includes no information evidencing it was executed in connection 

with the Note at issue, including a loan number, a borrower 

name, a loan amount or an execution date. The indorsement is 

made by an individual named Frank Esposito, but there is no 

indication of his title or whether he is an authorized agent.

The final document is titled “Endorsement” and contains a 

blank indorsement from Wells Fargo, Franklin Credit 

Management Corporation, Attorney in Fact. The indorsement is 

made by Kelli J. Airis, Vice President. The document is not 

dated, but includes the Note’s execution date, the original loan 

amount and lists Ms. Lewis as the original maker.

At trial [Terrence Schonleber, a Bayview employee] 

testified regarding the terms of the Note and that [Bayview] is in 

possession of the Note. When questioned by the [c]ourt about 

the allonges, [Bayview’s] counsel indicated the last allonge is 

that which is specially indorsed from Ocwen Federal Bank FSB to 

Federal Credit Corporation. [Bayview’s] counsel further 

explained that his office had the original Note prior to [Bayview] 

serving the loan, therefore the next allonge would be with 

[Bayview]. Counsel however, did not have said allonge at trial 

and did not offer it into evidence at trial. 

Trial Court Opinion, 2/11/16, at 6-8 (internal citations omitted).
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A review of the Note reflects that the trial court’s summary of the Note 

and multiple allonges is correct. Furthermore, its summation of Terrence 

Schonleber’s testimony and Bayview’s counsel’s comments is accurate. 

The trial court provided the following analysis in addressing Bayview’s 

claim that it had standing because it was in possession of the Note which 

was indorsed in blank:

Here, the allonges to the Note presented at trial contain so 

many inconsistencies and irregularities that this [c]ourt finds 

[Bayview] has not proven the Note is indorsed in blank. Initially, 

except for the blank indorsements on the Note itself and on the 

“Endorsement” document from Wells Fargo, all other allonges 

are specially indorsed to banks other than [Bayview]. Further, 

several of the allonges, including the Endorsement from Wells 

Fargo, are not dated. At trial, [Bayview] never established 

whether the allonges and Endorsement were in the proper 

chronological order. [Bayview] also did not establish whether 

the allonges and Endorsement were properly affixed to the Note 

so as to become part of the instrument pursuant to the Uniform 

Commercial Code. See UCC § 3-202(2) (“An endorsement must 

be written by or on behalf of the holder and on the instrument or 

on a paper so firmly affixed thereto as to become part thereof.”) 

Official Comment 3 (“A purported endorsement...pinned or 

clipped to an instrument is not sufficient for negotiation. The 

endorsement must be on the instrument itself, or on a paper 

intended for the purpose which is so firmly affixed to the 

instrument as to become as extension or part of it.”[)] 

Accordingly, [Bayview] did not prove the final document titled 

“Endorsement”, which contains the blank indorsement from 

Wells Fargo, is the final indorsement entitling [Bayview] to 

enforce the Note. In fact, as indicated above, [Bayview’s] 

counsel stated on the record that the last allonge to the Note is 

the allonge which is specially indorsed from Ocwen Federal Bank 

FSB to Federal Credit Corporation. While counsel speculated 

there would be another allonge to [Bayview], nothing was 

presented to the [c]ourt.

Further, [Bayview] never explain[ed] how the allonge from 

Sky Bank to Tribeca Loan Corporation relates to the Note at 
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issue or why it was included amongst the other allonges. Said 

allonge is undated and includes no information evidencing it was 

executed in connection with the Note. It contains no loan 

number, no borrower name, no loan amount and no execution 

date. There is also no indication it was executed by an 

authorized agent.

Accordingly, due to these irregularities and inconsistencies, 

and [Bayview’s] counsel’s statement at trial that the allonge 

specially indorsed from Ocwen Federal Bank FSB to Federal 

Credit Corporation is the last allonge, this [c]ourt finds 

[Bayview] has not proven the Note is indorsed in blank. 

Furthermore, because [Bayview] has not established the Note is 

specially indorsed over to [Bayview], [Bayview] lacks standing to 

enforce the Note.

Trial Court Opinion, 2/11/16, at 11-12 (internal citations omitted). 

We agree with the trial court’s analysis. As outlined above, Bayview 

has failed to establish that the Note is indorsed in blank, as it failed to 

establish that the “Endorsement” from Wells Fargo is the final indorsement 

entitling Bayview to enforce the Note. Additionally, Bayview’s counsel 

testified that the last allonge to the Note was the special indorsement from 

Ocwen Federal Bank FSB to Federal Credit Corporation. N.T., 9/8/15, at 14-

15. Bayview also failed to establish that the Note was specially indorsed to 

it. Id. at 15. Because the evidence does not establish that the Note is 

indorsed in blank, simple possession of the Note, even if obtained by 

transfer, is insufficient. Thus, we cannot conclude that the trial erred in 

concluding that Bayview lacked standing to enforce this Note on the basis of 

its possession of said Note. 
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Next, Bayview contends that even if it was not in possession of the 

duly indorsed Note, it has standing as assignee of the mortgage. Bayview’s 

Brief at 23. Bayview maintains that it is the holder of the mortgage by 

virtue of a valid assignment of mortgage from the last record holder of the 

mortgage, namely Wells Fargo. Id. at 23. Bayview also asserts that it 

introduced the final assignment of mortgage to Bayview at trial. Id. at 24. 

Accordingly, Bayview posits that the trial court erred in finding that it did not 

have standing in this action. Id. 

In a mortgage foreclosure action, the mortgagee is the real party 

in interest. See Wells Fargo Bank, N.A. v. Lupori, 8 A.3d 

919, 922 n. 3 (Pa.Super.2010). This is made evident under our 

Pennsylvania Rules of Civil Procedure governing actions in 

mortgage foreclosure that require a plaintiff in a mortgage 

foreclosure action specifically to name the parties to the 

mortgage and the fact of any assignments. Pa.R.C.P. 1147. A 

person foreclosing on a mortgage, however, also must own or 

hold the note. This is so because a mortgage is only the security 

instrument that ensures repayment of the indebtedness under a 

note to real property. See Carpenter v. Longan, 83 U.S. 271, 

275 (1872) (noting “all authorities agree the debt is the principal 

thing and the mortgage an accessory.”). A mortgage can have 

no separate existence. Id. When a note is paid, the mortgage 

expires. Id. On the other hand, a person may choose to 

proceed in an action only upon a note and forego an action in 

foreclosure upon the collateral pledged to secure repayment of 

the note. See Harper v. Lukens, 112 A. 636, 637 (Pa.1921) 

(noting “as suit is expressly based upon the note, it was not 

necessary to prove the agreement as to the collateral.”). For 

our instant purposes, this is all to say that to establish standing 

in this foreclosure action, appellee had to plead ownership of the 

mortgage under Rule 1147, and have the right to make demand 

upon the note secured by the mortgage.

CitiMortgage, Inc. v. Barbezat, 131 A.3d 65, 68 (Pa. Super. 2016).
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“An assignment is a transfer of property or some other right from one 

person to another, and unless in some way qualified, it extinguishes the 

assignor’s right to performance by the obligor and transfers that right to the 

assignee.” Legal Capital, LLC v. Med. Prof’l Liab. Catastrophe Loss 

Fund, 750 A.2d 299, 302 (Pa. 2000). “Where an assignment is effective, 

the assignee stands in the shoes of the assignor and assumes all of his 

rights.” Barbezat, 131 A.3d at 69. “[A] real party in interest is a [p]erson 

who will be entitled to benefits of an action if successful.... A party is a real 

party in interest if it has the legal right under the applicable substantive law 

to enforce the claim in question.” US Bank N.A. v. Mallory, 982 A.2d 986, 

994 (Pa. Super. 2009). 

In addressing this issue, the trial court provided the following analysis:

[Bayview] also failed to establish it is the current holder of 

the Mortgage by valid assignment. At trial, [Bayview] only 

presented to the [c]ourt a copy of the Bayview Assignment with 

no indication it was ever recorded. It was also not certified by 

the Philadelphia Commissioner of Records as a true and correct 

copy of the original. [Bayview] furthermore had not tendered 

proof of the chain of assignments from American Residential to 

[Bayview], as these assignments were not previously of record 

and were not provided to the [c]ourt at trial. While [Bayview] 

attached a copy of the recorded Bayview Assignment and all 

preceding mortgage assignments to the Motion for Post Trial 

Relief, these documents were not provided to the [c]ourt as 

proof at the time of trial and [Bayview] failed to prove the 

proper chain of title.

Trial Court Opinion, 2/11/16, at 12-13. 

In Pennsylvania, several statutes mandate that mortgages and 

documents conveying an interest in land be recorded. Pennsylvania permits 
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assignment of mortgages and, in order to be effective as against third 

parties, written assignments must be recorded in accordance with 21 P.S. 

§ 621 et seq. “No deed or mortgage, or defeasible deed, in the nature of 

mortgages, hereafter to be made, shall be good . . . unless such deed be 

acknowledged or proved and recorded within six months after the date 

thereof[.]” 21 P.S. § 621. Additionally,

“Every such deed, conveyance, contract, or other 

instrument of writing which shall not be . . . recorded, as 

aforesaid, shall be adjudged fraudulent and void as to any 

subsequent bona fide purchaser or mortgagee . . . without actual 

or constructive notice unless such deed, conveyance, contract, 

or instrument of writing shall be recorded . . . before the 

recording of the deed or conveyance[.]”

21 P.S. § 351. 

“All deeds and conveyances . . . shall be recorded in the 

office for the recording of deeds . . . within ninety days after the 

execution . . . and every such deed and conveyance that 

shall . . . be made . . . which shall not be . . . recorded as 

aforesaid, shall be adjudged fraudulent and void against any 

subsequent purchaser or mortgagee[.]”

21 P.S. § 444. Rule 1147(a) of the Pennsylvania Rules of Civil Procedure 

requires that a plaintiff in a mortgage foreclosure action set forth in the 

complaint, inter alia, “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.C.P. 1147(a)(1) (emphasis added). 

While what was purported to be an assignment of mortgage from 

Wells Fargo to Bayview was presented at trial, the trial judge noted on the 

record that there was no evidence that the assignment had been recorded or 
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that it was a certified copy. Thus, Bayview failed to establish that it was the 

possessor of the mortgage via a valid assignment from Wells Fargo. 

Moreover, there was no evidence presented at trial that established that the 

mortgage had been properly assigned and conveyed to Wells Fargo from the 

original mortgagee, American Residential Mortgage Corporation. 

As noted, while not presented to the court prior to trial, a recorded 

assignment from Wells Fargo to Bayview was presented to the trial court for 

the first time as an attachment to the post-trial motion. The assignments 

from American Residential Mortgage Corporation to Wells Fargo were also 

attached to Bayview’s post-trial motion. However, these documents were 

not of record at the time the trial court entered nonsuit. Thus, we cannot 

agree that the trial court erred in concluding that Bayview failed to establish 

that it was the mortgagee via a valid assignment. See Barnes v. Alcoa, 

Inc., 145 A.3d 730, 738 (Pa. Super. 2016) (explaining that this Court is 

prohibited from considering evidence not presented at trial when considering 

whether the trial court properly granted a nonsuit.).

Next, Bayview argues that the assignment of the mortgage to 

Bayview, whether recorded or not, demonstrates possession of the Note 

under section 3204(c) of the PUCC. Bayview’s Brief at 25. Bayview 

contends that the trial court erred in failing to find that it had standing by 

virtue of an assignment of mortgage, regardless of whether it was recorded, 

which demonstrated possession of the Note under section 3204(c) of the 
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PUCC. Id. Bayview asserts that “the Assignment of Mortgage to [Bayview], 

which was produced at trial, operates as an unqualified indorsement of the 

Note.” Id. 

Section 3204(c) of the PUCC provides as follows, in relevant part: “For 

the purpose of determining whether the transferee of an instrument is a 

holder, an indorsement that transfers a security interest in the instrument is 

effective as an unqualified indorsement of the instrument.” 13 Pa.C.S. 

§ 3204(c). For reasons explained previously, however, we cannot agree that 

Bayview has established that it was a holder in due course of the Note. 

Moreover, we determined that the trial court did not err in concluding that 

Bayview failed to establish that it was the mortgagee via a valid assignment. 

Thus, we cannot agree with Bayview’s argument that the assignment of the 

mortgage demonstrated possession of the Note. This claim also fails. 

Accordingly, we conclude that the trial court did not err in entering nonsuit 

against Bayview. 

In its final issue, Bayview asserts that it named all proper parties in 

this action and released Brenda E. Lewis in accordance with Pa.R.C.P. 

1144(b). Bayview Brief at 26. Therefore, the trial court erred in finding that 

it did not have subject matter jurisdiction over this case. Id. 

In its opinion, the trial court, sua sponte, concluded that it lacked 

subject matter jurisdiction over the foreclosure action because the Lewis 

Estate is an indispensable party and is not named a defendant. Trial Court 
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Opinion, 2/11/16, at 13. The trial court determined that Wells Fargo was 

required to name Ms. Lewis’s mother or the Lewis Estate as a defendant 

pursuant to Pa.R.C.P. 1144. Id. 

Rule 1144 of the Pennsylvania Rules of Civil Procedure, pertaining to 

mortgage foreclosure actions provides as follows:

Rule 1144. Parties. Release of Liability

(a) The plaintiff shall name as defendants

(1) the mortgagor;

(2) the personal representative, heir or devisee of a 

deceased mortgagor, if known; and

(3) the real owner of the property, or if the real 

owner is unknown, the grantee in the last recorded 

deed.

(b) Unless named as real owner, neither the mortgagor nor the 

personal representative, heir or devisee of the mortgagor, need 

be joined as defendant if the plaintiff sets forth in the complaint 

that the plaintiff releases such person from liability for the debt 

secured by the mortgage.

Pa.R.C.P. 1144.

We note that the amended complaint consists of a single statement, 

incorporating by reference the original complaint. Amended Complaint, 

4/5/12, at unnumbered 3. The following paragraph is included in the 

original complaint: “Pursuant to Pennsylvania Rule of Civil Procedure 1144, 

the Plaintiff releases from liability for the debt secured by the mortgage any 

mortgagor, personal representative, heir or devisee of the mortgagor who is 

not a real owner of the property at the time of the filing of this Complaint.” 
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Complaint, 1/26/11, at ¶ 25. The Complaint named Rutledge as the real 

owner of the property. Id. at ¶ 4. Thus, Wells Fargo, as party in interest 

prior to Bayview, complied with the requirement of Pa.R.C.P. 1144(b) by 

releasing the mortgagor, Brenda E. Lewis, and her personal representative 

or heir from liability for the debt secured by the mortgage. 

Judgment affirmed. 

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 12/21/2016