J-S10003-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
THE BANK OF NEW YORK MELLON : IN THE SUPERIOR COURT OF FKA THE BANK OF NEW YORK AS : PENNSYLVANIA TRUSTEE : : : v. : : : ROBERT J. HENRY AND ANNA MARIE : No. 2630 EDA 2017 HENRY : : Appellants :
Appeal from the Judgment Entered February 28, 2017 In the Court of Common Pleas of Chester County Civil Division at No(s): 15-09694
BEFORE: BOWES, J., OLSON, J., and NICHOLS, J.
MEMORANDUM BY BOWES, J.: FILED SEPTEMBER 11, 2018
Robert J. Henry and Anna Marie Henry appeal the in rem judgment of
mortgage foreclosure entered against them on February 28, 2017.1 We
affirm.
In 2005, Appellants executed an adjustable rate note (“the Note”) in
the amount of $725,167.00, payable in monthly installments of principal and
interest of $2,332.42, on their residential property located at 210 Richards ____________________________________________
1 Appellants purport to appeal from the order entered on June 30, 2017 denying their motions for post-trial relief. Ordinarily, an appeal properly lies from the entry of judgment, not from the order denying post-trial motions. See Johnston the Florist, Inc. v. TEDCO Constr. Corp., 657 A.2d 511 (Pa.Super. 1995). Accordingly, we deem this appeal as taken from the February 28, 2017 judgment. J-S10003-18
Way in Avondale, Chester County, Pennsylvania (“the Property”). The lender
under the Note was America’s Wholesale Lender, and the Note was indorsed
in blank by Countrywide Home Loans, Inc., a New York Corporation Doing
Business as America’s Wholesale Lender. Appellants also executed a
mortgage (hereinafter “the Mortgage”) on the Property as security for
payment of the Note. The Mortgage was executed in favor of Mortgage
Electronic Systems, Inc., as nominee for America’s Wholesale Lender.
In December 2009, Appellants defaulted on the Mortgage. In 2011,
the Mortgage was assigned to The Bank of New York Mellon, f/k/a The Bank
of New York, as trustee (CWALT 2005-82) (hereinafter “BNYM”), and the
assignment was duly recorded. In 2014, BNYM initiated the instant
mortgage foreclosure proceedings seeking an in rem judgment against
Appellants. Following a non-jury trial, the trial court entered an in rem
judgment in mortgage foreclosure in favor of BNYM on February 28, 2017.
Appellants timely filed a motion for post-trial relief and an amended motion
for post-trial relief, both of which were denied on June 30, 2017. Appellants
filed a timely notice of appeal, and a court-ordered Pa.R.A.P. 1925(b)
concise statement of errors complained of on appeal.
Appellants raise the following issues for our review:
1. Whether the trial court erred as a matter of law and abused its discretion in finding that [BNYM] was the holder in due course of the Note and entitled to enforce the Note indorsed in blank by a different corporate entity than the prior Noteholder was based on insufficient evidence and against the weight of the evidence to support that finding.
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2. Whether the trial court erred as a matter of law and abused its discretion in failing to make a finding that the two corporate entities appearing on the Note were separate and distinctly named corporations with no evidence of any relationship between the two was against the weight and sufficiency of the evidence.
3. Whether the trial court erred as a matter of law and abused its discretion and the court’s award was against the weight of the evidence by failing to dismiss [BNYM’s] complaint because [BNYM] was unable to meet its burden in showing it was the legal Noteholder and real party in interest and the court lacked subject matter jurisdiction.
Appellant’s brief at vii.
When reviewing the verdict from a bench trial, our standard of review
is as follows:
we must review the evidence of record in the light most favorable to the verdict winner to determine whether competent evidence supports the trial court’s findings and whether it erred in reaching its conclusions of law. We afford the same weight to the trial court’s findings of fact as we do a jury's verdict. We will only reverse if the trial court’s findings of fact are unsupported by competent evidence or if it erred as a matter of law.
Newman Dev. Grp. of Pottstown, LLC v. Genuardi's Family Mkt., Inc.,
98 A.3d 645, 652 (Pa.Super. 2014) (en banc) (internal citations omitted).
Each of Appellant’s issues are premised upon the same essential
argument. They contend that BNYM is not entitled to enforce the Note
because the endorsement in blank is invalid for the sole reason that the
entity identified as the indorser on the Note bears a different name than the
entity identified as the lender on the Note.. Specifically, Appellants claim
that the Note was not validly indorsed in blank because the lender is
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identified as “America’s Wholesale Lender,” whereas the indorsement in
blank was made by “Countrywide Home Loans, Inc., a New York Corporation
Doing Business as America’s Wholesale Lender.” Based on the difference in
the phrasing of the names of the lender and indorser, Appellants posit that
the trial court was “left to speculate as to whether or not there was a
relationship between the two corporate entities named on the Note.”
Appellants’ brief at 8. Appellants contend that, because BNYM did not
demonstrate a connection between “America’s Wholesale Lender” and
“Countrywide Home Loans, Inc., a New York Corporation Doing Business as
America’s Wholesale Lender,” the evidence is insufficient as a matter of law
to establish that BNYM is a holder in due course of the Note, and the trial
court lacked subject matter jurisdiction over the matter.
The holder of a mortgage has the right, upon default, to bring a
foreclosure action. Bank of Am., N.A. v. Gibson, 102 A.3d 462, 464
(Pa.Super. 2014). A person foreclosing on a mortgage, however, also must
own or hold the note. See Gerber v. Piergrossi, 142 A.3d 854 859
(Pa.Super. 2016). This is so because a mortgage is only the security
instrument that ensures repayment of the indebtedness under a note to real
property. Id. Under the Pennsylvania Uniform Commercial Code, the note
securing a mortgage is a negotiable instrument. J.P. Morgan Chase Bank,
N.A. v. Murray, 63 A.3d 1258, 1266 (Pa.Super. 2013). A note indorsed in
blank is a “bearer note,” payable to anyone on demand regardless of who
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previously held the note. 13 Pa.C.S. §§ 3109(a), 3301; see also Gibson,
supra at 466; PHH Mortg. Corp. v. Powell, 100 A.3d 611, 621 (Pa.Super.
2014) (“Evidence that some other entity may be the “owner” or an
“investor” in the [n]ote is not relevant to this determination, as the entity
with the right to enforce the note may well not be the entity entitled to
receive the economic benefits from payments received thereon.”).
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J-S10003-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
THE BANK OF NEW YORK MELLON : IN THE SUPERIOR COURT OF FKA THE BANK OF NEW YORK AS : PENNSYLVANIA TRUSTEE : : : v. : : : ROBERT J. HENRY AND ANNA MARIE : No. 2630 EDA 2017 HENRY : : Appellants :
Appeal from the Judgment Entered February 28, 2017 In the Court of Common Pleas of Chester County Civil Division at No(s): 15-09694
BEFORE: BOWES, J., OLSON, J., and NICHOLS, J.
MEMORANDUM BY BOWES, J.: FILED SEPTEMBER 11, 2018
Robert J. Henry and Anna Marie Henry appeal the in rem judgment of
mortgage foreclosure entered against them on February 28, 2017.1 We
affirm.
In 2005, Appellants executed an adjustable rate note (“the Note”) in
the amount of $725,167.00, payable in monthly installments of principal and
interest of $2,332.42, on their residential property located at 210 Richards ____________________________________________
1 Appellants purport to appeal from the order entered on June 30, 2017 denying their motions for post-trial relief. Ordinarily, an appeal properly lies from the entry of judgment, not from the order denying post-trial motions. See Johnston the Florist, Inc. v. TEDCO Constr. Corp., 657 A.2d 511 (Pa.Super. 1995). Accordingly, we deem this appeal as taken from the February 28, 2017 judgment. J-S10003-18
Way in Avondale, Chester County, Pennsylvania (“the Property”). The lender
under the Note was America’s Wholesale Lender, and the Note was indorsed
in blank by Countrywide Home Loans, Inc., a New York Corporation Doing
Business as America’s Wholesale Lender. Appellants also executed a
mortgage (hereinafter “the Mortgage”) on the Property as security for
payment of the Note. The Mortgage was executed in favor of Mortgage
Electronic Systems, Inc., as nominee for America’s Wholesale Lender.
In December 2009, Appellants defaulted on the Mortgage. In 2011,
the Mortgage was assigned to The Bank of New York Mellon, f/k/a The Bank
of New York, as trustee (CWALT 2005-82) (hereinafter “BNYM”), and the
assignment was duly recorded. In 2014, BNYM initiated the instant
mortgage foreclosure proceedings seeking an in rem judgment against
Appellants. Following a non-jury trial, the trial court entered an in rem
judgment in mortgage foreclosure in favor of BNYM on February 28, 2017.
Appellants timely filed a motion for post-trial relief and an amended motion
for post-trial relief, both of which were denied on June 30, 2017. Appellants
filed a timely notice of appeal, and a court-ordered Pa.R.A.P. 1925(b)
concise statement of errors complained of on appeal.
Appellants raise the following issues for our review:
1. Whether the trial court erred as a matter of law and abused its discretion in finding that [BNYM] was the holder in due course of the Note and entitled to enforce the Note indorsed in blank by a different corporate entity than the prior Noteholder was based on insufficient evidence and against the weight of the evidence to support that finding.
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2. Whether the trial court erred as a matter of law and abused its discretion in failing to make a finding that the two corporate entities appearing on the Note were separate and distinctly named corporations with no evidence of any relationship between the two was against the weight and sufficiency of the evidence.
3. Whether the trial court erred as a matter of law and abused its discretion and the court’s award was against the weight of the evidence by failing to dismiss [BNYM’s] complaint because [BNYM] was unable to meet its burden in showing it was the legal Noteholder and real party in interest and the court lacked subject matter jurisdiction.
Appellant’s brief at vii.
When reviewing the verdict from a bench trial, our standard of review
is as follows:
we must review the evidence of record in the light most favorable to the verdict winner to determine whether competent evidence supports the trial court’s findings and whether it erred in reaching its conclusions of law. We afford the same weight to the trial court’s findings of fact as we do a jury's verdict. We will only reverse if the trial court’s findings of fact are unsupported by competent evidence or if it erred as a matter of law.
Newman Dev. Grp. of Pottstown, LLC v. Genuardi's Family Mkt., Inc.,
98 A.3d 645, 652 (Pa.Super. 2014) (en banc) (internal citations omitted).
Each of Appellant’s issues are premised upon the same essential
argument. They contend that BNYM is not entitled to enforce the Note
because the endorsement in blank is invalid for the sole reason that the
entity identified as the indorser on the Note bears a different name than the
entity identified as the lender on the Note.. Specifically, Appellants claim
that the Note was not validly indorsed in blank because the lender is
-3- J-S10003-18
identified as “America’s Wholesale Lender,” whereas the indorsement in
blank was made by “Countrywide Home Loans, Inc., a New York Corporation
Doing Business as America’s Wholesale Lender.” Based on the difference in
the phrasing of the names of the lender and indorser, Appellants posit that
the trial court was “left to speculate as to whether or not there was a
relationship between the two corporate entities named on the Note.”
Appellants’ brief at 8. Appellants contend that, because BNYM did not
demonstrate a connection between “America’s Wholesale Lender” and
“Countrywide Home Loans, Inc., a New York Corporation Doing Business as
America’s Wholesale Lender,” the evidence is insufficient as a matter of law
to establish that BNYM is a holder in due course of the Note, and the trial
court lacked subject matter jurisdiction over the matter.
The holder of a mortgage has the right, upon default, to bring a
foreclosure action. Bank of Am., N.A. v. Gibson, 102 A.3d 462, 464
(Pa.Super. 2014). A person foreclosing on a mortgage, however, also must
own or hold the note. See Gerber v. Piergrossi, 142 A.3d 854 859
(Pa.Super. 2016). This is so because a mortgage is only the security
instrument that ensures repayment of the indebtedness under a note to real
property. Id. Under the Pennsylvania Uniform Commercial Code, the note
securing a mortgage is a negotiable instrument. J.P. Morgan Chase Bank,
N.A. v. Murray, 63 A.3d 1258, 1266 (Pa.Super. 2013). A note indorsed in
blank is a “bearer note,” payable to anyone on demand regardless of who
-4- J-S10003-18
previously held the note. 13 Pa.C.S. §§ 3109(a), 3301; see also Gibson,
supra at 466; PHH Mortg. Corp. v. Powell, 100 A.3d 611, 621 (Pa.Super.
2014) (“Evidence that some other entity may be the “owner” or an
“investor” in the [n]ote is not relevant to this determination, as the entity
with the right to enforce the note may well not be the entity entitled to
receive the economic benefits from payments received thereon.”).
Here, Appellants do not dispute that they executed the Note and the
Mortgage, or that they defaulted on their payments due under the Mortgage.
Appellants concede that the Mortgage was properly assigned to BNYM, and
that it is the holder of the Mortgage. Appellants do not dispute that BNYM
presented the original Note indorsed in blank at trial. Rather, they claim
that the Note’s indorsement in blank is invalid because the lender is
identified as “America’s Wholesale Lender,” whereas the indorsement in
blank was made by “Countrywide Home Loans, Inc., a New York Corporation
Doing Business as America’s Wholesale Lender.” Appellants posit that, due
to this difference in names, the lender and indorser are two separate
entities, thereby invalidating the indorsement in blank.
Appellants provide no relevant authority to support their assertion that
the addition of “doing business as” in a signature operates to bind only the
signing entity and not the designated entity. The use of “doing business as”
is commonly understood to alert interested parties to the fact that the
person or entity so designated, is known for business purposes under
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another or fictitious name. See Black’s Law Dictionary (10th ed. 2014) (The
abbreviation “d/b/a” “signals that the business may be licensed or
incorporated under a different name.”). As such, “doing business as” carries
no implication of representative capacity of a former individual or entity to
act on behalf of a latter entity; rather, akin to “a/k/a” (“also known as”),
“doing business as” identifies an equivalency or single identity between the
appellations. Hazer v. Zabala, 26 A.3d 1166, 1170 (Pa.Super. 2011).
Because the law recognizes “Countrywide Home Loans, Inc., a New
York Corporation Doing Business as America’s Wholesale Lender” as a single
entity identifiable under either appellation, we find no merit to Appellants
arguments that it is an entirely different entity than “America’s Wholesale
Lender.” See id. For this reason, Appellants claim that the indorsement in
blank is invalid must fail. The record in this case reveals that BNYM holds
the Note validly indorsed in blank, and the mortgage. As holder of the Note
and mortgage, BNYM has standing to pursue this foreclosure action as the
proper party in interest. Gibson, supra at 466. Appellant’s assertions to
the contrary are baseless.
Judgment affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq. Prothonotary
Date: 9/11/18
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