Court Opinion

ID: 4469049
Source: CourtListenerOpinion
Date Created: 2020-01-02 18:08:34.418834+00
Date Added: 2024-06-11T08:48:51.124304
License: Public Domain

J-A29038-19

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

    LSF9 MASTER PARTICIPATION                       :   IN THE SUPERIOR COURT OF
    TRUST                                           :        PENNSYLVANIA
                                                    :
                                                    :
                v.                                  :
                                                    :
                                                    :
    JEANNIE BEATTY NKA JEANNIE                      :
    PASTERNAK AND LUKE PASTERNAK                    :   No. 801 WDA 2019
                                                    :
                       Appellants

                  Appeal from the Order Entered April 9, 2019
       In the Court of Common Pleas of Allegheny County Civil Division at
                            No(s): MG-17-000443

BEFORE: BENDER, P.J.E., KUNSELMAN, J., and PELLEGRINI, J.*

MEMORANDUM BY PELLEGRINI, J.:                               FILED JANUARY 2, 2020

        Jeannie Beatty n/k/a Jeannie Pasternak and Luke Pasternak (the

Pasternaks) appeal from the order of the Court of Common Pleas of Allegheny

County (trial court) granting summary judgment in favor of LSF9 Master

Participation Trust (Lender) in this mortgage foreclosure action. We affirm.

                                               I.

        In 2007, the Pasternaks executed a mortgage and promissory note in

the amount of $118,560.94, which was secured by real property located at

Brooklawn Drive in Baldwin Borough, Allegheny County. The mortgage was

executed in favor of Lender’s predecessor-in-interest, Wells Fargo Financial

____________________________________________

*   Retired Senior Judge assigned to the Superior Court.
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Pennsylvania, Inc. (Wells Fargo), and recorded in the Office of the Recorder

of Deeds of Allegheny County.

     In April 2011, the Pasternaks filed a voluntary petition for relief under

Chapter 13 of the Bankruptcy Code in the United States Bankruptcy Court for

the Western District of Pennsylvania.     Under their Chapter 13 plan, the

Pasternaks would continue to make their monthly mortgage payments of

$1,167.51 to Wells Fargo. The Pasternaks were eventually discharged from

bankruptcy in December 2015.       Relevant to this appeal, the bankruptcy

trustee’s final report and accounting showed a total of $58,765.70 being

disbursed to Wells Fargo as a secured creditor. That following year, in August

2016, Wells Fargo assigned the mortgage to Lender.

     In April 2017, Lender filed this mortgage foreclosure action against the

Pasternaks, averring that they had defaulted on their mortgage payments and

owed the following:

            Principal                     $69,237.03
            Interest thru 04/04/2017      $ 8,838.15
            Escrow Balance                $ 4,217.96
            Tax Balance                   $   469.15
            Inspections                   $   105.00
            TOTAL                         $82,867.29

Complaint in Mortgage Foreclosure, 4/12/17, at ¶ 10.

     After the denial of preliminary objections, the Pasternaks filed an answer

and new matter admitting default but disputing the amount owed. They first

challenged the principal owed by claiming that Lender failed to properly

account for their payments to Wells Fargo during bankruptcy, which they

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claimed were “principal payments.”1            They also disputed owing any escrow

because, according to them, they had paid all taxes and insurance on the

property. Lender replied that the $58,765.70 disbursed through bankruptcy

was not applied solely to the principal because the lender determines how

those payments are applied, and that the escrow balance were funds that

were advanced on behalf of the Pasternaks by either Lender or its

predecessor-in-interest.

       On September 20, 2018, Lender filed a motion for summary judgment,

alleging that the Pasternaks now owed $92,988.24, including an escrow

balance of $3,679.45. The Pasternaks responded that there were still material

issues of fact raised about what they owed. On April 9, 2019, the trial court

entered an order granting the motion for summary judgment and entering

judgment in rem in favor of the Lender. A few days later, the Pasternaks filed

a motion for reconsideration, which the trial court denied.

       The Pasternaks timely appealed and raise three issues for our review:

       A. Whether the Trial Court erred by asserting that there were no
       genuine issues of material fact when it was well-pleaded that the
       balance of the mortgage was incorrect on the Plaintiff’s
       Complaint?

       B. Whether the Trial Court incorrectly determined the amount due
       to the Plaintiff because, in addition to the incorrect amount of
       mortgage due, Defendants have also been paying the taxes and
       insurance for the Property?
____________________________________________

1 Based on this contention, the Pasternaks also contended that Lender’s
interest calculation was incorrect.

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       C. Whether the Trial Court erred when it did not allow for
       reconsideration of the Motion due to inconsistent pleadings and
       issues of material fact that would otherwise prevent summary
       judgment to be granted?

                                               II.

       The Pasternaks’ first two issues challenge the trial court’s grant of

summary judgment in favor of Lender.2                Regarding mortgage foreclosure

____________________________________________

2 This Court’s scope and standard of review of a trial court’s order granting
summary judgment is well-settled:

       In reviewing an order granting summary judgment, our scope of
       review is plenary, and our standard of review is the same as that
       applied by the trial court. Our Supreme Court has stated the
       applicable standard of review as follows: [A]n appellate court may
       reverse the entry of a summary judgment only where it finds that
       the lower court erred in concluding that the matter presented no
       genuine issue as to any material fact and that it is clear that the
       moving party was entitled to a judgment as a matter of law. In
       making this assessment, we view the record in the light most
       favorable to the nonmoving party, and all doubts as to the
       existence of a genuine issue of material fact must be resolved
       against the moving party. As our inquiry involves solely questions
       of law, our review is de novo.

       Thus, our responsibility as an appellate court is to determine
       whether the record either establishes that the material facts are
       undisputed or contains insufficient evidence of facts to make out
       a prima facie cause of action, such that there is no issue to be
       decided by the fact-finder. If there is evidence that would allow a
       fact-finder to render a verdict in favor of the non-moving party,
       then summary judgment should be denied.

Gerber v. Piergrossi, 142 A.3d 854, 858 (Pa. Super. 2016) (citation
omitted). Summary judgment in mortgage foreclosure actions is subject to
the same rules as other civil actions. See Pa.R.C.P. 1141(b).

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proceedings, we have stated that “[i]n actions for in rem foreclosure due to

the defendant’s failure to pay a debt, summary judgment is proper where the

defendant admits that he had failed to make the payments due and fails to

sustain a cognizable defense to the plaintiff's claim.”    Gateway Towers

Condo. Ass’n v. Krohn, 845 A.2d 855, 858 (Pa. Super. 2004). In addition,

our Supreme Court has stated that in mortgage foreclosure cases, the entry

of summary judgment is proper where it is admitted that the mortgage is in

default, the mortgagors have failed to pay interest on the obligation, and that

the recorded mortgage is in the specified amount, even though the defendant

never admits the amount of the indebtedness in their pleadings. Landau v.

Western Pennsylvania National Bank, 282 A.2d 335, 340 (Pa. 1971).

       The Pasternaks contend that there was a genuine issue of material fact

to the principal owed.        According to them, all of their payments during

bankruptcy were “principal payments” because the trustee listed the

$58,765.50 under the “principal paid” column in her final report and account.

See Pasternaks’ Brief at 7.3 Lender counters that because the mortgage was

a long-term continuing debt, it was the lender and not the trustee who

____________________________________________

3 The Pasternaks did not attach or include the trustee’s final report and
accounting with their February 7, 2018 answer and new matter. However,
the report was included in their May 23, 2017 preliminary objections to the
complaint in mortgage foreclosure.

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determined how the borrowers’ payments were applied to the mortgage. See

Lender’s Brief at 7.

       We agree with Lender. A Chapter 13 bankruptcy plan does not alter

how the debtor’s payments will be applied by the lender because Section

1322(b)(2) of the Bankruptcy Code precludes debtors from modifying the

rights of home lenders. See In re deLone, 205 Fed.Appx. 964, 967 (3rd.

Cir. 2006).4 When the Pasternaks filed their voluntary bankruptcy petition in

2011, the terms of the note and mortgage were not altered. As a result, Wells

Fargo, as Lender’s predecessor-in-interest, could apply the Pasternaks’

monthly mortgage payments to interest and principal in accordance with the

original note. Their mortgage payments did not become interest-free simply

because they paid them through a bankruptcy plan, and the Pasternaks cite

no case law to support such a proposition. That the trustee’s report listed the

$58,765.50 under the column for “principal paid” cannot support the

Pasternaks’ argument that Lender miscalculated the principal. Accordingly,

the trial court did not err in holding that there was no material issue of fact as

to the principal amount owed.

____________________________________________

4 Section 1322(b)(2) of the Bankruptcy Code provides that a plan may “modify
the rights of holders of secured claims, other than a claim secured only by a
security interest in real property that is the debtor’s principal residence, or of
holders of unsecured claims, or leave unaffected the rights of holders of any
class of claims[.]” 11 U.S.C. § 1322(b)(2).

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      The Pasternaks also contend that their pleadings created a genuine issue

of material fact about the escrow owed. First, their answer clearly did not do

this, having failed to plead any specific facts refuting any amount owed,

answering instead: “Denied. It is strictly denied that Defendants owe the

balance as stated by the Plaintiff and strict proof is required at time of trial.”

Answer and New Matter, 2/7/18, at ¶ 10. This Court has observed that general

denials constitute admissions when a specific denial is required. See Bank

of America, N.A. v. Gibson, 102 A.3d 42, 466-67 (Pa. Super. 2014) (citing

Pa.R.C.P. 1029(b)).

      Moreover, the Pasternaks’ new matter did not create a genuine issue of

material fact. Rather than provide specific dates of payment of insurance and

taxes, the Pasternaks averred that they “have paid taxes and insurance for

the Property since the inception of the mortgage.” Answer and New Matter,

2/7/18, at ¶ 22. However, they did not include or attach any substantiating

documents corroborating their averment.         In addition, responding to the

motion for summary judgment, the Pasternaks generally denied the amount

owed, stating that they had already given their reasons for disputing the

amount owed, not attaching any substantiating documents corroborating their

averment. See Response to Motion for Summary Judgment, 12/4/18, at ¶ 7.

      When responding to a motion for summary judgment setting forth

evidence establishing the moving party’s right to relief, “the adverse party

may not rest upon mere allegations or denials of the pleadings,” Pa.R.C.P.

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1035.3(a), but must identify evidence controverting the evidence cited in

support of the motion or establishing facts essential to the defense that the

motion cites as not having been produced.          Pa.R.C.P. 1035.3(a)(1)-(2).

“[P]arties seeking to avoid the entry of summary judgment against them ...

are   required   to   show,   by   depositions,   answers   to   interrogatories,

admissions[,] or affidavits, that there is a genuine issue for trial.”   Wash.

Fed. Sav. & Loan Assn. v. Stein, 515 A.2d 980, 981 (Pa. Super. 1986).

      Here, the Pasternaks generally denied the amount owed in their answer

and then claimed in their new matter that they had paid all the insurance and

taxes without providing specifics or corroborating evidence beyond that.

When faced with summary judgment, rather specifically denying that they

owed any escrow or that any funds were advanced to ensure the payment of

the property’s taxes or insurance, the Pasternaks instead chose to rely on their

previous pleadings in disputing the amount owed. Under Pa.R.C.P. 1035.3(a),

the Pasternaks needed to identify evidence controverting Lender’s factual

averment that they owed escrow. By failing to do that, the trial court did not

err in granting summary judgment.

      In their final issue, the Pasternaks argue that the trial court should have

granted their motion for reconsideration of its order granting summary

judgment.   However, an order denying reconsideration is unreviewable on

appeal. See Huntington Nat. Bank v. K-Cor, Inc., 107 A.3d 783,787 (Pa.

Super. 2014) (“Pennsylvania case law is absolutely clear that the refusal of a

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trial court to reconsider, rehear, or permit reargument of a final decree is not

reviewable on appeal.”).

      Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 1/2/2020

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