Wells Fargo Bank, N.A. v. Ortolani, J. ( 2019 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
WELLS FARGO BANK, N.A. : IN THE SUPERIOR COURT OF
PENNSYLVANIA
v.
JACQUELYN ORTOLANI AND
ANTHONY ORTOLANI
: No. 1383 EDA 2018
APPEAL OF: JACQUELYN ORTOLANI
Appeal from the Order Entered April 3, 2018
In the Court of Common Pleas of Montgomery County Civil Division at
No(s): No. 14-23915
BEFORE: OTT, J., DUBOW, J., and STEVENS*, P.J.E.
MEMORANDUM BY STEVENS, P.J.E.: FILED JANUARY 07, 2019
Appellant Jacquelyn Ortolani ("Mrs. Ortolani") appeals from the April 3,
2018, order entered in the Court of Common Pleas of Montgomery County
granting Appellee Wells Fargo Bank, N.A.'s ("Wells Fargo Bank") motion for
summary judgment in this in rem mortgage foreclosure action.' After a
careful review, we affirm.
The relevant facts and procedural history are as follows: On October
27, 2000, Anthony and Jacquelyn Ortolani (collectively "the Ortolanis"), in
' During this matter, a default judgment was entered in favor of Wells Fargo
Bank and against Anthony Ortolani ("Mr. Ortolani"), who is divorced from Mrs.
Ortolani. Mr. Ortolani did not seek to open the default judgment, and he is
not a party to this appeal. We note the order at issue is a final order disposing
of all parties and all claims. See Pa.R.A.P. 341(b)(1).
Former Justice specially assigned to the Superior Court.
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consideration of a loan in the principal amount of $210,000.00, executed a
promissory note ("note") in favor of World Savings Bank, FSB ("World Savings
Bank"). As security for their obligations under the note, the Ortolanis
executed and delivered to World Savings Bank a mortgage for property located
on Gwynmont Drive, Montgomery Township, Pennsylvania; World Savings
Bank duly recorded the mortgage. Thereafter, World Savings Bank changed
its name to Wachovia Mortgage, FSB, and then changed its name to Wells
Fargo Bank Southwest, N.A, and as of November 1, 2009, merged into Wells
Fargo Bank, resulting in Wells Fargo Bank as the surviving corporation.
On August 19, 2014, Wells Fargo Bank filed a civil complaint in mortgage
foreclosure alleging the Ortolanis had made no mortgage payments since
September 15, 2010; Wells Fargo Bank was the eventual successor of World
Savings Bank via merger; Wells Fargo Bank was the holder of the mortgage
and note; and Wells Fargo Bank had possession of the note. Wells Fargo Bank
indicated that it sent to the Ortolanis a Notice of Intention to Foreclose, a
Notice of Homeowner's Emergency Assistance Program, and a Notice of
Default. Wells Fargo Bank noted that a judicial sale of the premises was
intended.
Wells Fargo Bank attached to its complaint a certification from the
Comptroller of the Currency Administrator of National Banks in support of its
allegation of merger. See Wells Fargo Bank's Complaint, filed 8/19/14, Exhibit
A. It also attached to its complaint a copy of the duly -recorded mortgage,
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which was executed between the borrowers (the Ortolanis) and the lender
(World Savings Bank, its successors, and/or assignees), as well as a copy of
the note, which was executed between the borrowers (the Ortolanis) and the
lender (World Savings Bank, its successors, and/or assignees).
After the Ortolanis failed to respond to the complaint, on May 25, 2016,
Wells Fargo Bank obtained a default judgment against them. However, Mrs.
Ortolani filed a petition to open the default judgment, which the trial court
granted.
On October 11, 2017, Mrs. Ortolani filed a counseled answer with new
matter to Wells Fargo Bank's complaint, and Wells Fargo Bank filed a reply to
the new matter. On January 23, 2018, Wells Fargo Bank filed a motion for
summary judgment averring, inter alia, that there is no dispute the mortgage
is in default, Wells Fargo Bank is the holder of the note and mortgage, and
Wells Fargo Bank complied with the applicable notice requirements.
Additionally, Wells Fargo Bank attached an affidavit from Cynthia A. Thomas,
the vice president of loan documentation for Wells Fargo Bank. Ms. Thomas
confirmed, inter a/ia, that Wells Fargo Bank has possession of the original
note.
Mrs. Ortolani filed a response to the motion for summary judgment. By
order entered on April 3, 2018, the trial court granted Wells Fargo Bank's
motion for summary judgment and entered judgment in favor of Wells Fargo
Bank.
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On May 1, 2018, Mrs. Ortolani contemporaneously filed a "Motion to
Enforce Proposed Consent Judgment Stipulation," a "Motion for
Reconsideration of Summary Judgment," and a notice of appeal to this Court
from the trial court's April 3, 2018, summary judgment order.
In the "Motion to Enforce Proposed Consent Judgment Stipulation," Mrs.
Ortolani averred that, while Wells Fargo Bank's summary judgment motion
was pending in the trial court, "the parties were engag[ed] in extensive
discussion as to resolution of the matter." Mrs. Ortolani's Motion to Enforce
Proposed Consent Judgment Stipulation, filed 5/1/18. She further averred
that Wells Fargo Bank conveyed a written proposal to Mrs. Ortolani on March
29, 2018. See id. The cover letter to the proposal indicated, "Kindly review,
execute and return it [to] our office within ten (10) business days from the
date of this letter."2 See id. She noted the tenth business day was April 9,
2018; however, before the expiration of the proposal date, the trial court
entered summary judgment on April 3, 2018. See id. Mrs. Ortolani noted
she contacted Wells Fargo Bank on April 5, 2018, after receiving the summary
judgment order, and indicted she wanted to accept Wells Fargo Bank's
proposal. See id. However, Wells Fargo Bank emailed Mrs. Ortolani on April
9, 2018, indicating the proposal had been rescinded. Mrs. Ortolani averred
Wells Fargo Bank was not permitted to withdraw the offer after she verbally
2 Mrs. Ortolani attached to her motion a copy of the written consent judgment
stipulation. We note the stipulation has not been signed by any of the parties.
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accepted it on April 5, 2018. Accordingly, she sought to have the summary
judgment order opened/stricken and the proposed consent judgment
stipulation enforced.
In the "Motion for Reconsideration of Summary Judgment," Mrs. Ortolani
averred the summary judgment order should be opened/stricken since she
accepted Wells Fargo Bank's consent judgment proposal prior to the Bank
withdrawing the offer.
The trial court never ruled on Mrs. Ortolani's "Motion to Enforce
Proposed Consent Judgment Stipulation" or "Motion for Reconsideration of
Summary Judgment." Instead, by order entered on May 18, 2018, the trial
court directed Mrs. Ortolani to file a statement pursuant to Pa.R.A.P. 1925(b).3
Mrs. Ortolani timely complied on June 6, 2018, and the trial court filed a
responsive Pa.R.A.P. 1925(a) opinion on June 27, 2018.
On appeal, Mrs. Ortolani presents the following issues in her statement
of questions involved:
1. Was summary judgment properly granted when [Wells Fargo
Bank] failed to produce clear, definite proof of its actual
ownership of the original mortgage note as [] an alleged
successor in interest in order to establish that it was the proper
real property in interest?
2. Was summary judgment properly granted when [Wells Fargo
Bank] provided and relied on a self-serving Affidavit from
Cynthia A. Thomas in support of its motion for summary
3The trial court's order complied with Pa.R.A.P. 1925(b)(3) pertaining to the
required contents.
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judgment and its contention that [Wells Fargo Bank] had the
original note and that it was duly endorsed?
3. Did the trial court err in failing to open/strike the summary
judgment in this mortgage foreclosure case entered April 5,
2018[,] so that [Mrs. Ortolani's] motion for reconsideration
filed May 1, 2018[,] and/or motion to enforce proposed consent
judgment stipulation filed May 1, 2018[,] could be ruled on as
right before summary judgment was entered, [Wells Fargo
Bank] had proposed a consent judgment stipulation to [Mrs.
Ortolani], open until April 9, 2018, but revoked same on April
9, 2018[,] after summary judgment was entered? The docket
reflects the filing of the Motions as well as the Affidavit of
Service of same. If [Mrs. Ortolani] cannot proceed with this
appeal, then she would be foreclosed from challenging [Wells
Fargo Bank's] revocation of the proposed Consent Judgment
Stipulation and its alleged validity until and on April 9, 2018.
Mrs. Ortolani's Brief at 4-5 (suggested answers omitted).4
It is well -settled that:
Our scope of review of a trial court's order granting or
denying summary judgment is plenary, and our standard of review
is clear: the trial court's order will be reversed only where it is
established that the court committed an error of law or abused its
discretion.
Summary judgment is appropriate only when the record
clearly shows that there is no genuine issue of material fact and
that the moving party is entitled to judgment as a matter of law.
The reviewing court must view the record in the light most
favorable to the nonmoving party and resolve all doubts as to the
existence of a genuine issue of material fact against the moving
party. Only when the facts are so clear that reasonable minds
could not differ can a trial court properly enter summary
judgment.
4We have renumbered Mrs. Ortolani's appellate issues for the sake of effective
appellate review. We note that Mrs. Ortolani's issues raised in her Rule
1925(b) statement and her statement of the questions involved are identical.
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Hovis v. Sunoco, Inc., 64 A.3d 1078, 1081 (Pa.Super. 2013) (quoting
Cassel -Hess v. Hoffer, 44 A.3d 80, 84-85 (Pa.Super. 2012)). "[P]arties
seeking to avoid the entry of summary judgment against them may not rest
upon the averments contained in their pleadings. On the contrary, they are
required to show, by depositions, answers to interrogatories, admissions or
affidavits, that there is a genuine issue for trial." Washington Fed. Say. &
Loan Ass'n v. Stein, 515 A.2d 980, 981 (Pa.Super. 1986) (citing Pa.R.C.P.
1035(d)).
Combining her argument for her first and second issues, Mrs. Ortolani
avers the trial court improperly granted Wells Fargo Bank's motion for
summary judgment since Wells Fargo Bank did not have standing to
commence the instant mortgage foreclosure action.5 Specifically, Mrs.
Ortolani claims Wells Fargo Bank failed to prove "ownership and possession of
the original note" so as to permit it to commence the instant mortgage
foreclosure action. Mrs. Ortolani's Brief at 14. See J.P. Morgan Chase
Bank, N.A. v. Murray, 63 A.3d 1258 (Pa.Super. 2013) (holding a debtor's
claim that bank was not a real party in interest to bring a foreclosure action
was a challenge to the bank's standing).
The law is clear that only "the real party in interest" may prosecute a
legal action. Pa.R.C.P. No. 2002(a).
5 Mrs. Ortolani indicates that, "[f]or judicial expedience,"
she is combining her
first two issues into one argument section. Mrs. Ortolani's brief at 14.
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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. No. 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, [] 21 L. Ed. 313 (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, 271 Pa. 144, 112
A. 636, 637 (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, [the Bank] had to
plead ownership of the mortgage under Rule 1147, and have the
right to make demand upon the note secured by the mortgage.'
1The rules relating to mortgage foreclosure actions do not expressly
require that the existence of the note and its holder be pled in the action.
Nonetheless, a mortgagee must hold the note secured by a mortgage to
foreclose upon a property. "The note and mortgage are inseparable;
the former as essential, the latter as an incident." Longan, 83 U.S. at
274.
CitiMortgage, Inc. v. Barbezat, 131 A.3d 65, 68 (Pa.Super. 2016).
Based upon our review of the record, the facts are clear and no
reasonable minds could differ as to the conclusion that Wells Fargo Bank had
standing in this matter. Mrs. Ortolani admitted that she obtained a loan from
World Savings Bank and executed a note and mortgage in favor of World
Savings Bank. See Mrs. Ortolani's Answer to Complaint, filed 10/11/17. Wells
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Fargo Bank averred in its complaint that the original bank, World Savings
Bank, changed its name to Wachovia Mortgage, and then changed its name
to Wells Fargo Bank Southwest, and as of November 1, 2009, merged with
Wells Fargo Bank, resulting in Wells Fargo Bank as the surviving corporation.
See Wells Fargo Bank's Complaint, filed 8/19/14. Mrs. Ortolani indicated "no
response" to this averment was necessary. See Mrs. Ortolani's Answer to
Complaint, filed 10/11/17. Wells Fargo Bank also averred that it was the
holder of Mrs. Ortolani's mortgage and note via the merger of the banks. See
Wells Fargo Bank's Complaint, filed 8/19/14. Mrs. Ortolani denied these
assertions generally based on lack of her independent knowledge. See Mrs.
Ortolani's Answer to Complaint, filed 10/11/17. Wells Fargo Bank attached to
its complaint a certification from the Comptroller of the Currency
Administrator of National Banks in support of its allegation of merger. See
Wells Fargo Bank's Complaint, filed 8/19/14, Exhibit A. It also attached to its
complaint a copy of the mortgage, which was executed between the borrowers
(the Ortolanis) and the lender (World Savings Bank, its successors, and/or
assignees), as well as a copy of the note, which was executed between the
borrowers (the Ortolanis) and the lender (World Savings Bank, its successors,
and/or assignees).
It is well -settled that when the original mortgage company merges with
another company, the surviving corporation becomes the mortgagee under
the mortgage agreement, as it "succeeds to both the rights and obligations of
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the constituent corporations." See Park v. Greater Delaware Valley Say.
& Loan Ass'n, 523 A.2d 771, 775-76 (Pa.Super. 1987). As a result, the
surviving corporation becomes the real party in interest in a mortgage
foreclosure action. See 12 U.S.C.A. § 215a(e). No assignment or
endorsement is necessary to bestow upon the surviving bank the status of the
real party in interest to enforce a debt owed to its predecessor. See id. 12
U.S.C. § 215a(e); 7 P.S. § 1606. The surviving corporation, however, has
only the same rights with respect to the debt that its predecessor had at the
time of merger. See J.P. Morgan Chase Bank, N.A, supra (suggesting
succession by merger is sufficient proof to show ownership of note and
mortgage). If the predecessor in interest was entitled to enforce the note at
the time of merger, then the surviving corporation may do the same. See id.
This assumes, however, that the predecessor in interest was, at the time of
the merger, itself entitled to enforce the note. See id.; 13 Pa.C.S.A. §
3302(c).
Here, there is no genuine issue of material fact that the original bank,
World Savings Bank, although renamed several times, merged into Wells
Fargo Bank and, at the time of merger, could have enforced the mortgage and
note. Thus, as a matter of law, given the fact Wells Fargo Bank is the surviving
corporation that succeeded World Savings Bank, Wells Fargo Bank's right to
enforce the mortgage and note arises by operation of its ownership of the
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asset through mergers and acquisitions. See J.P. Morgan Chase Bank,
N.A., supra; Park, supra.
Regarding Mrs. Ortolani's suggestion Wells Fargo Bank failed to prove it
had possession of the original note, assuming such possession is material,
Mrs. Ortolani denied generally Wells Fargo Bank's allegation that it had
possession of the note and she demanded proof. Mrs. Ortolani's Answer to
Complaint, filed 10/11/17. The trial court noted Wells Fargo Bank attached
a copy of the original note to its complaint. Further, Wells Fargo Bank
produced and attached to its motion for summary judgment a sworn affidavit
from Ms. Thomas, who indicated that, during the regular performance of her
job duties and record keeping for Wells Fargo Bank, she was able to confirm
that Wells Fargo Bank was in possession of the note. Mrs. Ortolani responded
that the sworn affidavit is "self-serving."6 She submitted no evidence during
discovery contrary to Wells Fargo Bank's allegation of possession. See
Washington Fed. Say. & Loan Ass'n, 515 A.2d at 983 ("In order to properly
raise a genuine issue of fact, [the appellant] had the burden to present 'facts'
by counter -affidavits, depositions, admissions, or answers to
interrogatories."). Thus, we conclude Mrs. Ortolani failed to establish a
6 To the extent Mrs. Ortoloni contends that, in granting summary judgment,
the trial court may not rely upon "self-serving" sworn affidavits, we conclude
she has not properly developed an argument with regard thereto on appeal.
See Pa.R.A.P. 2119.
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genuine issue of material fact as to this issue, and the trial court did not err
in entering summary judgment as a matter of law in favor of Wells Fargo Bank.
In her final issue, Mrs. Ortolani avers the trial court abused its discretion
in failing to open/strike the summary judgment order and considering her
motion for reconsideration and/or motion to enforce the proposed consent
judgment stipulation.7 Specifically, Mrs. Ortolani avers the trial court should
have exercised its power under 42 Pa.C.S.A. § 5505 since there were
"extraordinary circumstances relating to the proposed consent judgment
stipulation" present in this case. See Mrs. Ortolani's Brief at 13.
Initially, we note that, after the trial court entered its April 3, 2018,
order granting summary judgment, on May 1, 2018, Mrs. Ortolani filed a
notice of appeal, as well as her motion for reconsideration and motion to
enforce the proposed consent judgment stipulation. Pennsylvania Rule of
Appellate Procedure 1701 and Section 5505 generally prohibit a trial court
from proceeding further in the matter after an appeal is taken, but there are
exceptions. See Pa.R.A.P. 1701; 42 Pa.C.S.A. § 5505.
As this Court has recognized:
Rule 1701(a) of the Rules of Appellate Procedure states that,
"after an appeal is taken ... the trial court ... may no longer
proceed further in the matter." Pa.R.A.P. 1701(a); see also 42
Pa.C.S.A. § 5505 (stating that a court may modify any order
within thirty days after its entry so long as no appeal from such
Mrs. Ortolani does not dispute that her motion to enforce the prosed consent
judgment stipulation sought reconsideration of the trial court's summary
judgment order, and therefore, we shall treat it as such on appeal.
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order has been taken). However, according to Rule 1701(b)(3),
"[a]fter an appeal is taken," the trial court may "[g]rant
reconsideration of the order which is the subject of the appeal," if
"an application for reconsideration of the order is filed in the trial
court ... within the time provided or prescribed by law" and "an
order expressly granting reconsideration of such prior order is filed
in the trial court ... within the time prescribed by these rules for
the filing of a notice of appeal." Pa.R.A.P. 1701(b)(3).
Commonwealth v. Haughwout, 816 A.2d 247, 249-50 (Pa.Super. 2003).
Accordingly, relevant to the case sub judice, notwithstanding the fact
Mrs. Ortolani filed a timely notice of appeal, since she filed her motion for
reconsideration and motion to enforce the proposed consent judgment
stipulation "within the time provided or prescribed by law" (i.e., within thirty
days after the trial court's order granting summary judgment), the trial court
had the authority to rule on, and in fact expressly grant reconsideration if it
were so inclined, as long as it did so within thirty days of its April 3, 2018,
summary judgment order. See Haughwout, supra. See also Pa.R.A.P.
1701; 42 Pa.C.S.A. § 5505. However, contrary to Mrs. Ortolani's suggestion,
the trial court was not required to act on the motions. Rather, the trial court's
authority in this regard was "almost entirely discretionary[.]" Verholek v.
Verholek, 741 A.2d 792, 798 (Pa.Super. 1999) (en banc). See Moore v.
Moore, 535 Pa. 18, 634 A.2d 163, 167 (1993) (indicating the trial court's
authority to reconsider its own judgment "is left to the sound discretion of the
trial court"). Simply put, in the case sub judice, Mrs. Ortolani has not
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convinced us that the trial court abused its discretion in failing to open/strike
the summary judgment order and rule on the motions at issue.8
For all of the foregoing reasons, we affirm.
Affirmed.
Judgment Entered.
,
Jseph D. Seletyn,
Prothonotary
Date: 1/7/19
8 In its Rule 1925(a) opinion, the trial court relevantly noted:
By asserting in her concise statement only that th[e] [trial] court
erred in failing to open/strike the entry of summary judgment
[and rule on her motions], [Mrs. Ortolani] has waived any claim
that th[e] [trial] court abused its discretion in not granting
reconsideration. See Moore, supra (stating that a request for
reconsideration is addressed to the sound discretion of the trial
court)[.]
Trial Court Opinion, filed 6/27/18, at 4 n.4. We agree with the trial court and,
thus, to the extent Mrs. Ortolani argues on appeal the trial court erred in
expressly granting her motions, we find the claim to be waived. See Pa.R.A.P.
1925(b)(4)(vii) ("Issues not included in the Statement and/or not raised in
accordance with the provisions of this paragraph (b)(4) are waived.").
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