Penn Security Bank v. Holtzman, A.

• Court: Superior Court of Pennsylvania
• Decided: October 30, 2015
• Docket: 3201 EDA 2014
• Status: Unpublished

Opinion

J-A16016-15

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

PENN SECURITY BANK & TRUST IN THE SUPERIOR COURT OF COMPANY, PENNSYLVANIA

Appellee

v.

DR. ALEXANDER J. HOLTZMAN AND NANCY HOLTZMAN,

Appellants No. 3201 EDA 2014

Appeal from the Judgment Entered October 17, 2014 In the Court of Common Pleas of Monroe County Civil Division at No(s): 2613-CV-2013

BEFORE: LAZARUS, OLSON and PLATT,* JJ.

MEMORANDUM BY OLSON, J.: FILED OCTOBER 30, 2015

Appellants, Dr. Alexander J. Holtzman and Nancy Holtzman, appeal

from an order entered on October 17, 2014 that granted summary judgment

in this mortgage foreclosure action in favor of Penn Security Bank & Trust

Company (the Bank). After careful review, we affirm.

On December 15, 2010, Appellants executed a promissory note in

favor of the Bank to obtain a residential home loan in the amount of

$175,000.00. The note was repayable in monthly installments of principal,

together with accrued interest, in the amount of $1,477.16 for a five-year

term, followed by a balloon payment of $133,015.92. To secure the note,

Appellants granted the Bank a mortgage interest in real property located in

Pocono Township in Monroe County, Pennsylvania.

*Retired Senior Judge assigned to the Superior Court. J-A16016-15

In August 2012, Appellants defaulted under the terms and conditions

of the loan documents by failing to make monthly payments in accordance

with their note. On October 2, 2012, counsel for the Bank forwarded a

letter demanding payment from Appellants of all past due sums owed under

the parties’ loan agreements. Thereafter, in accordance with Acts 91 and 6,

the Bank again advised Appellants that the mortgage on their home was in

default. In addition, the Bank informed Appellants that it intended to

foreclose on its mortgage interest in their property and that it would

accelerate their mortgage debt if Appellants did not cure the arrearage.

Appellants were also informed of corrective actions they could take to avoid

foreclosure on their property. Appellants did not cure the default or seek

emergency assistance.

On April 1, 2013, the Bank filed a complaint against Appellants. The

complaint contained two counts, one asserting mortgage foreclosure claims

and one sounding in breach of contract. The Bank attached the loan

documents to its complaint and alleged, in relevant part, that Appellants,

“failed to repay the indebtedness pursuant to the terms and conditions of

the Lending documents in that the [Appellants’] last loan payment was made

to the Bank [in August 2012].” Complaint, 4/1/13, at 3 ¶11. The Bank also

alleged that Appellants owed a principal balance of $164,762.68 on the

mortgage with accrued interest totaling $6,844.21. Id. at 4 ¶19. Together

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with other fees recoverable under the parties’ lending agreement, the Bank

alleged that Appellants owed a total of $173,533.20.1 Id.

Appellants filed a timely answer and new matter to the Bank’s

complaint on April 22, 2013. Appellants asserted general denials in

response to the material allegations of the complaint, alleging that they were

without knowledge or information sufficient to form a belief as to the truth of

the Bank’s allegations. See Answer and New Matter, 4/22/13, at 5, 8-9

¶¶’s11 and 19. Appellants did not aver specific facts that contravened the

Bank’s assertions.

Neither side conducted discovery in this case. On April 11, 2014, just

over one year after filing its complaint, the Bank moved for summary

judgment on its mortgage foreclosure claims. To support its motion, the

Bank attached an affidavit executed by Edward Walsh, a senior vice

president employed by the lender. Walsh’s affidavit included a schedule of

indebtedness owed as of the filing date of the Bank’s motion showing an

unpaid balance of $308,382.86. The schedule reflected the same unpaid

principal balance alleged in the complaint, updated sums for accrued interest

and document preparation fees, and a claim for counsel fees totaling

____________________________________________

1 The Bank’s complaint listed attorneys’ fees as a component of its damages but did not specify a sum certain for this expense. Instead, the complaint alleged that this expense would be determined later.

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$123,344.80. Appellants filed their response to the Bank’s motion on April

25, 2014.

On October 17, 2014, the trial court issued an opinion and order in

which it granted the Bank’s motion and entered summary judgment in its

favor for $175,533.29. In reaching its decision, the court did not entertain

oral argument or adversarial briefs on behalf of the parties. Instead, the

court reasoned that Appellants’ general denials to the material allegations of

the complaint must be deemed admissions in the context of a mortgage

foreclosure case since Appellants would be aware of any arrearage and

unpaid balance on their mortgage. See Trial Court Opinion, 10/17/14, at

4-6. As such, the court determined that Appellants failed to raise a genuine

issue of material fact and that the Bank was entitled to judgment as a

matter of law.

Appellants filed a timely notice of appeal on November 7, 2014. By

order entered on November 14, 2014, the court directed Appellants to file a

concise statement of errors complained of on appeal pursuant to Pa.R.A.P.

1925(b). Appellants timely complied by filing their concise statement on

December 5, 2014. On December 16, 2014, the trial court issued a brief

statement under Pa.R.A.P. 1925(a) asking this Court to vacate and remand

this matter for oral argument and the submission of briefs in view of the

Bank’s failure to file a praecipe for argument under Mon.R.C.P. 1035.2 at the

time it filed the motion for summary judgment.

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Appellants challenge an order granting the Bank’s motion for summary

judgment. Our standard of review over such a claim is well settled.

[O]ur standard of review of an order granting summary judgment requires us to determine whether the trial court abused its discretion or committed an error of law. Our scope of review is plenary. In reviewing a trial court's grant of summary judgment, we apply the same standard as the trial court, reviewing all the evidence of record to determine whether there exists a genuine issue of material fact. We view the record in the light most favorable to the non-moving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party. Only where there is no genuine issue as to any material fact and it is clear that the moving party is entitled to a judgment as a matter of law will summary judgment be entered. All doubts as to the existence of a genuine issue of a material fact must be resolved against the moving party.

***

Upon appellate review, we are not bound by the trial court's conclusions of law, but may reach our own conclusions.

Rule of Civil Procedure 1035 governs motions for summary judgment and provides, in relevant part, as follows:

After the relevant pleadings are closed, but within such time as not to unreasonably delay trial, any party may move for summary judgment in whole or in part as a matter of law

(1) whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report, or

(2) if, after the completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury.

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Pa.R.C.P. 1035.2. This Court has explained the application of this rule as follows:

Motions for summary judgment necessarily and directly implicate the plaintiff's proof of the elements of a cause of action. Summary judgment is proper if, after the completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury. In other words, whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense, which could be established by additional discovery or expert report and the moving party is entitled to judgment as a matter of law, summary judgment is appropriate. Thus, a record that supports summary judgment either (1) shows the material facts are undisputed or (2) contains insufficient evidence of facts to make out a prima facie cause of action or defense.

Criswell v. Atlantic Richfield Co., 115 A.3d 906, 908 (Pa. Super. 2015)

(case citations omitted).

In their first issue, Appellants argue that they were denied a full and

fair opportunity to be heard because of the Bank’s failures to comply with

local procedural rules. Specifically, Appellants point out that the Bank failed

to file and serve a praecipe for argument pursuant to Mon.R.C.P. 1035.2 at

the time it moved for summary judgment. Appellants claim that the Bank’s

procedural oversight deprived them of a fair chance to contest the Bank’s

motion and that, as a result, the court’s adverse summary judgment order

denied them of their right to due process of law. We disagree.

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Although a trial court must afford parties a full and fair opportunity to

oppose a motion for summary judgment, a court may enter summary

judgment in the absence of oral argument or the filing of responsive briefs

where the record obviates the need for such proceedings and neither side is

prejudiced. Myszkowski v. Penn Stroud Hotel, Inc., 634 A.2d 622, 624

(Pa. Super. 1993); Gerace v. Holmes Protection of Phila., 516 A.2d 354,

359 (Pa. Super. 1986). In this case, Appellants received the Bank’s

complaint and motion and, in response to each filing, timely filed their

answer and new matter as well as their response to the motion for summary

judgment. As the Bank points out, “neither party filed a brief or participated

in oral argument.” Bank’s Brief at 18. Thus, neither party secured an

advantage over the other on this basis and the trial court disposed of the

Bank’s motion based upon the admissions that emerged from the parties’

pleadings and submissions. While Appellants complain that they were

denied the opportunity to file a supportive brief and participate in oral

argument, they point to no facts that raise a genuine issue requiring a trial

and no case law that demonstrates how they are entitled to a favorable

ruling. The trial court did not rule in the Bank’s favor because Appellants

procedurally defaulted on their claims. Instead, the trial court determined

that Appellants effectively admitted that their mortgage was in default and

that they continued to owe the Bank an accelerated debt pursuant to the

lending documents. Under these circumstances, we discern no error or

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abuse of discretion in the trial court’s order granting summary judgment

without first allowing the parties to participate in oral argument and submit

briefs.

In their second issue, Appellant’s claim that the Bank relied exclusively

on the Walsh affidavit in seeking summary judgment and that the trial court

violated the rule in Borough of Nanty-Glo v. American Surety Co. of

New York, 163 A. 523, 524 (Pa. 1932) in ruling in the Bank’s favor. In

Nanty-Glo, our Supreme Court held that oral testimony, even if

uncontradicted, is generally insufficient to establish the absence of a genuine

issue of material fact. Id. Appellants’ contention merits no relief.

An exception to the Nanty-Glo rule applies where a party moving for

summary judgment supports its motion with the admissions of the opposing

party or the opposing party’s witnesses. Porterfield v. Trustees of the

Hospital of the University of Pennsylvania, 657 A.2d 1293, 1295 (Pa.

Super. 1995). Our review of the party’s submissions, the opinion of the trial

court, and the record certified on appeal confirms that the trial court based

its decision on the admissions of fact that emerged from Appellants’ general

denials of the claims set forth in the Bank’s complaint, and not on the Walsh

affidavit. See infra; see also Trial Court Opinion, 10/17/14, at 4-6.

Specifically, Appellants generally denied their failure to repay the

indebtedness under the terms and conditions of the loan documents, as well

as the Bank’s allegations with respect to the unpaid balance of Appellants’

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mortgage. Such responses are ineffective and the corresponding allegations

may be deemed admitted for purposes of the Bank’s summary judgment

motion. See First Wisconsin Trust Co. v. Strausser, 653 A.2d 688, 692

(Pa. Super. 1995) (summary judgment properly entered where mortgagors

admit by way of general denials that they are without knowledge or

information sufficient to form a belief as to the truth of alleged past due

interest and principal balances). Since Appellants are deemed to have

admitted the material allegations set forth in the Bank’s complaint, we

conclude that the Nanty-Glo rule did not apply and the Bank was entitled to

summary judgment.2

Judgment affirmed. Jurisdiction relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq. Prothonotary

Date: 10/30/2015

2 Only one component of the Bank’s damage claim was included in the Walsh affidavit, but not set forth in the Bank’s complaint. We refer here to the Bank’s request for $123,344.80 in attorneys’ fees in this mortgage foreclosure case. Since the trial court wisely excluded this amount from its award, and because the Bank has not challenged the trial court’s order on appeal, we see no basis to disturb the judgment on this ground.

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