Court Opinion

ID: 4560780
Source: CourtListenerOpinion
Date Created: 2020-08-27 16:11:25.455445+00
Date Added: 2024-06-11T09:27:41.537688
License: Public Domain

J-A18011-20

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

 DONALD JAMES WALKER AND                  :   IN THE SUPERIOR COURT OF
 ROSEANN WALKER, HIS WIFE                 :        PENNSYLVANIA
                                          :
                                          :
              v.                          :
                                          :
                                          :
 MICHAEL J. MAFFEO, JR., KARA             :
 WALKER AND DONALD JOSEPH                 :   No. 1478 WDA 2019
 WALKER                                   :
                                          :
                                          :
 APPEAL OF: MICHAEL J. MAFFEO,            :
 JR.                                      :

             Appeal from the Order Entered September 12, 2019
     In the Court of Common Pleas of Allegheny County Civil Division at
                           No(s): GD14-002883

BEFORE: BENDER, P.J.E., DUBOW, J., and NICHOLS, J.

MEMORANDUM BY BENDER, P.J.E.:                       FILED AUGUST 27, 2020

      Michael J. Maffeo, Jr. (“Maffeo”) appeals from the order dated

September 11, 2019 and entered September 12, 2019, granting Donald James

Walker and Roseann Walker’s (“the Walkers”) motion for sanctions, declaring

the transfer of real property from Maffeo to Maffeo and his wife, Karen L.

Maffeo (“Wife”), as tenants in the entireties null and void, and prohibiting any

further transfer of said property to avoid collection of a judgment entered in

the Court of Common Pleas of Allegheny County. The order further awarded

attorneys’ fees in the amount of $1,000.00 in favor of the Walkers. After

careful review, we vacate the order and remand with instructions.
J-A18011-20

      We previously summarized the facts of this matter during a prior appeal

to this Court:

            Maffeo and his sister, Clara Urbanek (“Clara”), each
      inherited a one-half interest in their family home in Pittsburgh,
      Pennsylvania (“the Property”). The Property had an appraised
      value of $110,000. When Maffeo’s daughter, Kara, became
      engaged to Donald Joseph Walker (“DJ”), he wanted to help them
      own a home. To that end, in April of 2008, Maffeo orchestrated
      an agreement of sale (“AOS”) signed by Clara as the Seller, and
      himself, Kara, and DJ as the Buyers, whereby Kara and DJ would
      acquire title to the Property. The undated AOS—prepared by
      Maffeo’s attorney—provided that DJ and Kara would obtain a
      mortgage, and if they defaulted, divorced, or did not marry, they
      would convey their joint one-half interest in the Property to
      Maffeo.

            DJ and Kara tried to secure a mortgage for the purchase of
      Clara’s one-half interest in the Property for $55,000. When they
      could not obtain a mortgage, DJ and Kara approached DJ’s
      parents, the Walkers, for the money. The Walkers agreed to pay
      the $55,000 for Clara’s interest in the Property. In doing so, the
      Walkers were unaware of the AOS. They believed that DJ and
      Kara would obtain Clara’s one-half interest in the Property and
      that Maffeo would give his one-half interest to Kara and DJ.
      Additionally, the Walkers expected that DJ and Kara would repay
      the $55,000 by obtaining a home equity loan during their first year
      of marriage.

            The Walkers obtained a home equity loan on April 22, 2008,
      and wrote a check to Clara for $55,000 on April 29, 2008. Maffeo
      took the check from the Walkers and gave it to Clara, who cashed
      the check on May 5, 2008. By deed dated September 9, 2008,
      Clara transferred her one-half interest in the Property to Maffeo,
      who then held full title. By deed dated March 3, 2009, Maffeo
      transferred title in the Property to himself (one-half interest) and
      DJ and Kara (one-half interest) as joint tenants. During their
      marriage, DJ and Kara lived in the Property and made four
      payments of $385 each to the Walkers; however, they did not
      obtain a home equity loan to repay the $55,000.

            DJ and Kara separated in August of 2010, with DJ leaving
      the Property. A divorce decree was entered on September 17,

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      2013. By deed dated February 28, 2014, DJ and Kara transferred
      their one-half interest in the Property to Maffeo, at which point
      Maffeo again held full title to the Property. Maffeo allowed Kara
      and her daughter to live in the Property rent-free.

            Approximately one week before DJ and Kara conveyed their
      one-half interest in the Property to Maffeo in February of 2014,
      the Walkers filed a complaint in equity against Maffeo, Kara, and
      DJ, seeking an interest in the Property based on their payment of
      the purchase price for Clara’s one-half interest. Additionally, the
      Walkers sought an injunction and consequential damages. The
      trial court appointed a special master who unsuccessfully
      mediated the case and prepared a report.

             By stipulation of the parties, the trial court ordered the
      taking of depositions, which, along with the documents of record
      and the Walkers’ proposed findings of facts and conclusions of law,
      it used to decide the case. Based on its independent review, the
      trial court agreed with the special master that the Walkers were
      entitled to a purchase money resulting trust, and it awarded them
      a one-half interest in the Property as joint tenants with Maffeo.
      The trial court directed Maffeo and the Walkers to:

         [E]xecute and file with the Allegheny County Department of
         Real Estate, a deed in a legally sufficient form to transfer
         fee simple title in the Property from [Maffeo to Maffeo and
         the Walkers], so that the Property is held as tenants in
         common with a one-half ownership interest in the Property
         to be held by [Maffeo] and … the other one-half ownership
         interest in the Property to be held by [the Walkers].

      Maffeo filed a motion for post-trial relief, which the trial court
      denied. The trial court’s [a]mended [o]rder was reduced to
      judgment on August 9, 2017. Maffeo appealed.

Walker v. Maffeo, 2018 WL 1835375 at *1-2 (Pa. Super. April 18, 2018)

(footnote and citations to record omitted).

      On appeal, this Court determined that the trial court erred in finding

that the Walkers were entitled to a resulting trust.         See id. at *5.

Nevertheless, we affirmed the trial court based on our conclusion that Maffeo

was unjustly enriched by obtaining full ownership of the Property without any

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consideration paid in the original transaction with his sister, Clara. Id. at *5-

6 (citing Lynn v. Nationwide Ins. Co., 70 A.3d 814, 823 (Pa. Super. 2013)

(stating that this Court may affirm the trial court on any basis supported by

the record)).1     “[A]llowing Maffeo to accept the $55,000 and retain Clara’s

one-half interest in the Property without payment of that value to the Walkers

would be unjust and unconscionable.”             Id. at *6 (citing Gutteridge v. J3

Energy Group, Inc., 165 A.3d 908, 917 (Pa. Super. 2017) (en banc) (“To

sustain a claim of unjust enrichment, a claimant must show that the party

against whom recovery is sought either wrongfully secured or passively

received a benefit that it would be unconscionable for her to retain.”)). Thus,

we concluded that Maffeo is liable to the Walkers for $55,000.                  Id.

Accordingly, we vacated the judgment and remanded for the trial court to

enter judgment in favor of the Walkers for $55,000, plus interest. Id.

____________________________________________

1  Our determination of unjust enrichment was based on our reasonable
inference from the record,

       that the Walkers expected their $55,00 payment would buy
       Clara’s one-half interest in the Property for DJ and Kara. However,
       Maffeo unilaterally used the $55,000 from the Walkers to obtain
       Clara’s one-half interest in the Property for himself. Maffeo then
       conveyed Clara’s one-half interest to himself, DJ and Kara, as joint
       tenants, citing $55,000 as consideration. Upon DJ and Kara’s
       divorce, Maffeo obtained full title to the Property. To the extent
       Maffeo argues that the Walkers must seek repayment from DJ and
       Kara, his position ignores a critical fact: Maffeo—not DJ and
       Kara—used the Walkers’ $55,000 to obtain full title in his name.

Id. at *6 (citations to record omitted).

                                           -4-
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       Maffeo filed a petition for allowance of appeal with the Pennsylvania

Supreme Court, which was denied on January 3, 2019.               The Walkers

subsequently praeciped the Common Pleas Court of Allegheny County to enter

judgment in accordance with this Court’s April 18, 2018 decision. On March

29, 2019, a judgment was entered in favor of the Walkers and against Maffeo

in the amount of $71,798.35, plus recording costs.      Maffeo did not file an

appeal from the judgment.

       During their attempt to collect on the judgment, the Walkers discovered

that Maffeo transferred his ownership of the Property, by deed dated March 4,

2015, to himself and Wife, as tenants in the entirety.      The deed was not

recorded until May 14, 2018, shortly after the entry of this Court’s prior

decision. On July 25, 2019, the Walkers filed a motion for sanctions with the

trial court, alleging that the transfer of the Property constituted a fraudulent

conveyance in violation of the Pennsylvania Uniform Fraudulent Transfer Act

(“PUFTA”), 12 Pa.C.S. §§ 5101-5114,2 and seeking to void the transfer.

Maffeo filed a response to the Walkers’ motion, and the trial court scheduled

an argument for September 11, 2019.

       The trial court opined:

       During the pendency of the litigation and appeals, and knowing
       that he was likely obligated to pay [the Walkers] at least the
       $55,000[,] Maffeo transferred his title to the property, the very
____________________________________________

2 See 12 Pa.C.S. § 5101 (Feb. 20, 2018) (“This chapter, that was formerly
cited as the [PUFTA], shall be known and may be cited as the Pennsylvania
Uniform Voidable Transactions Act.”). For the purpose of consistency, we will
continue to refer to the Act as the PUFTA herein.

                                           -5-
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      subject of the litigation, to himself and … [W]ife, by deed dated
      May 4, 2015, and recorded it on May 14, 2018. This lawsuit was
      filed three (3) months prior to Maffeo’s fraudulent transfer, and
      the recorded deed was less than a month after the Superior Court
      decision. Thus, Maffeo’s transfer to … [W]ife was concealed from
      the [Walkers] and from this [c]ourt and [the] Appellate Courts
      throughout the litigation, with Maffeo’s intent to make himself
      judgment proof against any collection taken by the Walkers.

Trial Court Opinion (“TCO”), 11/20/19, at 3.

      Following the September 11, 2019 argument on the Walkers’ motion,

the trial court entered an order, which declared “the fraudulent transfer of the

[P]roperty” from Maffeo to himself and Wife “null and void[,]” prohibited

Maffeo “from further transfer of the … [P]roperty to avoid collection of the

judgment[,]” and awarded the Walkers attorneys’ fees in the amount of

$1,000.00. See Trial Court Order, 9/11/19.

      Maffeo filed a timely appeal on September 26, 2019, followed by a

timely, court-ordered Pa.R.A.P. 1925(b) statement. Herein, Maffeo presents

the following issues for our review:

      [I.] Did the lower court err in granting the [Walkers’] motion for
      sanctions[,] because after the lower court entered the judgment
      on March 29, 2019[,] as directed by the Superior Court of
      Pennsylvania, the lower court no longer had jurisdiction of this
      matter?

      [II.] Did the lower court err in granting the [Walkers’] motion for
      sanctions[,] because the matters complained of in the motion for
      sanctions raised allegations of an alleged fraudulent transfer
      under the [PUFTA,] which should have been raised in a separate
      civil action complaint alleging a violation of the [PUFTA]?

      [III.] Did the lower court err in awarding attorney[s’] fees in any
      amount and in an amount in excess of the fees requested by the
      [Walkers]?

Maffeo’s Brief at 4 (unnecessary capitalization omitted).

                                       -6-
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      Preliminarily, we address sua sponte the issue of whether the trial court

lacked subject matter jurisdiction for failure to join Wife as an indispensable

party. It is well-settled that:

      Under Pennsylvania law, the failure to join an indispensable party
      implicates the trial court’s subject matter jurisdiction. Sabella v.
      Appalachian Dev. Corp., 103 A.3d 83, 90 (Pa. Super. 2014).
      “Failure to join an indispensable party goes absolutely to the
      court’s jurisdiction and the issue should be raised sua sponte.”
      Barren v. Dubas, … 441 A.2d 1315, 1316 ([Pa. Super.] 1982)
      (internal quotation marks and citations omitted).

Orman v. Mortgage I.T., 118 A.3d 403, 406 (Pa. Super. 2015).

             “A party is indispensable ‘when his or her rights are so
      connected with the claims of the litigants that no decree can be
      made without impairing those rights.’”          City of Phila. v.
      Commonwealth, … 838 A.2d 566, 581 ([Pa.] 2003), quoting
      Sprague v. Casey, … 550 A.2d 184, 189 ([Pa.] 1988). “If no
      redress is sought against a party, and its rights would not be
      prejudiced by any decision in the case, it is not indispensable with
      respect to the litigation.”      Grimme Combustion, Inc. v.
      Mergentime Corp., … 595 A.2d 77, 81 ([Pa. Super.] 1991), citing
      Sprague, supra. We have consistently held that a trial court
      must weigh the following considerations in determining if a party
      is indispensable to a particular litigation.

         1. Do absent parties have a right or an interest related to
            the claim?

         2. If so, what is the nature of that right or interest?

         3. Is that right or interest essential to the merits of the
            issue?

         4. Can justice be afforded without violating the due process
            rights of absent parties?

      Martin v. Rite Aid of Pa., Inc., 80 A.3d 813, 814 (Pa. Super.
      2013); accord Mechanicsburg Area Sch. Dist. v. Kline, … 431
      A.2d 953, 956 ([Pa.] 1981). “In determining whether a party is
      indispensable, the basic inquiry remains ‘whether justice can be
      done in the absence of a third party.’” Pa. State Educ. Ass’n v.

                                      -7-
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        Commonwealth, … 50 A.3d 1263, 1277 ([Pa.] 2012), quoting
        CRY, Inc. v. Mill Serv., Inc., … 640 A.2d 372, 375 ([Pa.] 1994).

Id. at 406-07. We have previously held that “in actions intended to affect the

title to property which is either held or claimed by tenants by the entireties,

both spouses are indispensable parties and must be joined.” Id. at 407.

        Applying these principles to the case sub judice, it is undisputed that

the deed, dated May 4, 2015 and recorded on May 14, 2018, was executed

by Maffeo and Wife, as tenants by the entireties. As Wife’s name is listed on

the deed and the September 11, 2019 order declaring the deed null and void

clearly affects her interest in the Property, we conclude that Wife is an

indispensable party and should have been joined in the underlying matter.

Accordingly, we discern that the trial court lacked subject matter jurisdiction

over this matter.

        Moreover, we note that the Walkers should have commenced a separate

equitable action under the PUFTA to request that the alleged fraudulent

conveyance be set aside.3 See Garden State Standardbred Sales Co., Inc.

v. Seese, 611 A.2d 1239, 1242 (Pa. Super. 1992) (citing Greater Valley

Terminal Corporation v. Goodman, 202 A.2d 89, 93 (Pa. 1964) (holding

that “supplementary proceedings may not be used to adjudicate conflicting

rights or claims made in good faith to property in the possession of third

persons, because it deprives defendants in such actions of the protection

afforded by the safeguards of a full hearing”)).

____________________________________________

3   The PUFTA outlines remedies available to creditors. See 12 Pa.C.S. § 5107.

                                           -8-
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      Based on the foregoing, we conclude the trial court lacked subject

matter jurisdiction to enter an order declaring the transfer of the Property to

Maffeo and Wife null and void. Accordingly, the trial court’s September 11,

2019 order is vacated, and the case is remanded with instructions for the trial

court to enter an order dismissing the Walkers’ motion for sanctions without

prejudice, consistent with this memorandum.

      Order vacated. Case remanded. Jurisdiction relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 8/27/2020

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