Court Opinion

ID: 9695215
Source: CourtListenerOpinion
Date Created: 2023-08-25 18:12:20.54654+00
Date Added: 2024-06-11T18:20:09.157943
License: Public Domain

ROWLEY, Judge,
dissenting:
I respectfully dissent.
In Buchandn III, this Court vacated a summary judgment which was entered by the trial court on the ground that a trust relationship existed between the class members and Federal National Mortgage Association. The panel specifically noted that the trial court’s decision to grant *11summary judgment was based on several factors including but not limited to: 1) the fact that the words “to be held ... in trust” in the agreement strongly indicated that a trust was contemplated; 2) that in Buchanan I the Supreme Court had determined that although the use of the word “trust” in the mortgage agreement is not determinative of the intent to create a trust, an intent to create a trust was manifested by the provisions of the agreement transferring property with directions that the transferee deal with the property for the benefit of another; and 3) the factors enumerated in Comment (g) of the Restatement (Second) of Trust, § 12 with regard to whether or not a trust is contemplated when interest is not paid on money deposited with another as security.
The panel concluded that the trial court misinterpreted Buchanan I, and that all the Court held in that case was that the plaintiffs should have the opportunity at trial to present evidence establishing that a trust, and not a debt, was created; that the absence of an agreement to pay interest was not a crucial factor, but only a “significant” one; and that there were factors from Comment (g) of the Restatement (Second) of Trusts, § 12 which the trial court did not consider, and that the trial court failed to mention Comment (b) of the Restatement (Second) of Trusts § 12 which was “more nearly on point.” Buchanan III, 306 Pa.Super. at 261, 452 A.2d at 544. In vacating the summary judgment and remanding, the panel in Buchanan III stated:
Because Buchanan I does not preclude the finding of a debtor-creditor relationship, and because we hold that the absence of an agreement to pay interest does not necessarily mean that a trust relationship was intended, there remains as a genuine issue of material fact whether or not the parties intended to enter into a trust relationship.

Id.

It seems apparent from the panel decision in Buchanan III that the court held that summary judgment could not be entered because there was a factual question concerning the intent of the parties to establish a trust, which question *12could not be resolved as a matter of law by applying principles of law to the written mortgage agreement, and it was necessary to remand for the presentation of evidence as to the intent of the parties.
Upon remand, a trial was held following which the court determined that the evidence showed among other things that: 1) it was the standard practice in the industry for mortgagees to require mortgagors to make advance payments for taxes and insurance, but not to compensate the mortgagors for the advance payments; 2) that the mortgagors did not examine the mortgage to determine whether or not they would have to pay monthly sums for taxes and insurance; 3) that the mortgagors had no recollection of the substance of any of their discussions concerning the terms of the mortgage with counsel; and 4) that the mortgagors never discussed the terms of the mortgage with the mortgagee. Thus there was no evidence introduced at the trial which was not already in the record when the motion for summary judgment was filed to indicate that there was an intention to create a trust.
In the present case, by virtue of Buchanan III, it is the “law of the case” that whether or not the parties intended to create a trust is a factual determination which cannot be ascertained as a matter of law. Because the evidence introduced at trial which was not available for the court’s consideration on the motion for summary judgment does not show that the parties intended to create a trust, the adjudication of the trial court following trial that there was not a trust relationship, should be affirmed. The majority’s determination in the instant appeal that there was a trust relationship is premised exclusively on the terms of the mortgage agreement itself. Since in Buchanan III the court held, as the law of the case, that the intention of the parties to establish a trust relationship could not be determined as a matter of law from the terms of the mortgage agreement itself, the majority’s decision in the present case is contradictory with Buchanan III.
Upon remand, and pursuant to the express instructions of the Court in Buchanan III, the trial court held a hearing *13and thereafter found as a fact that a trust relationship had not been established.
The scope of appellate review in equity cases is quite clear. A chancellor’s findings of fact, when approved by a court en banc, have the force and effect of a jury verdict and will not be disturbed on appeal if supported by adequate evidence. [Citation omitted.] However, the chancellor’s inferences and conclusions which are drawn from the facts, and the application of the law are always subject to review. [Citations omitted.]
McDole v. Duquesne Brewing Company of Pittsburgh, 281 Pa.Super. 78, 83, 421 A.2d 1155, 1158 (1980); quoting from Philadelphia Fresh Food Terminal Corporation v. M. Levin and Company, 239 Pa.Super. 287, 292, 361 A.2d 886, 889 (1976). My review of the record of the trial following Buchanan III shows that it supports the trial court’s factual determination that a trust relationship was not established. Therefore, in my opinion it is not appropriate to reverse the factual determination of the trial court. I would affirm the judgment on the trial court’s opinion.
BROSKY, J., joins the dissenting opinion by ROWLEY, J.