Myers v. Wells Fargo Bank, N.A., 3218 EDA 2008

• Decision Date: 15 December 2009
• Docket Number: No. 3218 EDA 2008,3218 EDA 2008
• Citation: 2009 PA Super 241,986 A.2d 171
• Court: Pennsylvania Superior Court
• Parties: June F. MYERS, Appellee v. WELLS FARGO BANK, N.A., T/A Premier Asset Services and T/A Wells Fargo Home Mortgage, U.S. Bank National Association and Fox & Roach, L.P., T/A Prudential Fox & Roach, Appellees Appeal of U.S. Bank National Association, Appellant.

986 A.2d 171

2009 PA Super 241

June F. MYERS, Appellee v. WELLS FARGO BANK, N.A., T/A Premier Asset Services and T/A Wells Fargo Home Mortgage, U.S. Bank National Association and Fox & Roach, L.P., T/A Prudential Fox & Roach, Appellees Appeal of U.S. Bank National Association, Appellant.

No. 3218 EDA 2008

Superior Court of Pennsylvania.

Argued October 6, 2009.

Filed December 15, 2009.

Anne E. Walters, Cherry Hill, N.J., for appellant.

Francis X. Clark, King of Prussia, for appellee.

BEFORE: STEVENS, BOWES, JJ., and McEWEN, P.J.E.

OPINION BY STEVENS, J.:

¶ 1 This is an appeal from the order entered in the Court of Common Pleas of Bucks County denying Appellant U.S. Bank National Association's (hereinafter U.S. Bank) petition to open a default judgment entered in favor of Appellee June F. Myers (hereinafter Ms. Myers). We affirm.

¶ 2 The relevant facts and procedural history are as follows: On January 11, 2008, Ms. Myers filed a civil complaint against Wells Fargo Bank, N.A. (hereinafter Wells Fargo), t/a Premier Asset Services and t/a Wells Fargo Home Mortgage, U.S. Bank, and Prudential Fox & Roach, L.P. (hereinafter Prudential), averring that, in the spring and summer of 2007, Ms. Myers sought to sell her residence at 26 Penn Avenue, Souderton, Pennsylvania, and purchase a new duplex property in the Souderton area. Ms. Myers entered into a real estate agent representation contract with Century 21 Keim Realtors of Allentown, Pennsylvania (hereinafter Century 21), through which Century 21 was to list 26 Penn Avenue residence for sale and assist Ms. Myers in purchasing a new duplex.

¶ 3 Ms. Myers further averred that, in May of 2007, U.S. Bank foreclosed upon a residential duplex property located at 218-220 Springhouse Lane, Telford, Pennsylvania, and on June 12, 2007, U.S. Bank, as trustee for Structured Asset Investment Loan Trust 2005-8, recorded a sheriff's deed for the Springhouse Lane property. Ms. Myers averred that, thereafter, Wells Fargo, through its Premier Asset Services (hereinafter PAS) or Wells Fargo Home Mortgage (hereinafter WFHM) division, sought to sell the Springhouse Lane property as an undisclosed agent of U.S. Bank, and the property was listed with Prudential with an asking price of $229,900.00, which was advertised as being $50,000.00 less than the property's fair market value since the property needed extensive renovations.

¶ 4 On August 10, 2007, Ms. Myers and her children,¹ acting through Ms. Myers' agent at Century 21, submitted an offer in the form of a standard agreement for sale to purchase the Springhouse Lane property. The offer was subject to a mortgage contingency for a total loan of $245,630.00, which would cover the purchase price and renovations for the property, as well as a mortgage commitment date of September 13, 2007, with closing occurring by September 24, 2007. Ms. Myers provided a good faith deposit of $1,500.00 to Wells Fargo agents at Prudential.

¶ 5 On August 17, 2007, acting through its agents at PAS, WFHM and/or Prudential, Wells Fargo made a counter offer for the sale of the property for a total of $212,000.00, substantially incorporating the terms of Ms. Myers' offer, including the mortgage contingency, and indicating that closing would occur on or before October 15, 2007. On August 20, 2007, Ms. Myers accepted Wells Fargo's counter offer and signed the agreement of sale.

¶ 6 Immediately thereafter, Century 21 notified Wells Fargo's agent that Ms. Myers required a copy of the signed property sales agreement to present to potential lenders in order to obtain a mortgage for the subject property. Thereafter, Ms. Myers attempted to acquire a mortgage; however, Wells Fargo failed to provide Ms. Myers with a signed property sales agreement until September 14, 2007, which was just thirty-one days before the closing deadline. When the signed sales agreement was provided to Ms. Myers, Diane LePera, who was a real estate agent at Prudential, indicated that an extension for the closing date would be given so that Ms. Myers could obtain financing.

¶ 7 Ms. Myers averred that, on September 26, 2007, Century 21 informed Ms. LePera that an extension until November 15, 2007 would be necessary so that Ms. Myers could obtain financing. Apparently, unbeknownst to Ms. Myers, Ms. LePera did not forward the request for a closing extension to Wells Fargo until October 9, 2007, at which time Ms. LePera falsely informed Wells Fargo and its representatives that the delay in closing was caused by Ms. Myers' changing of mortgage companies. Ms. Myers and Century 21 continued to press Wells Fargo for a signed commitment extending the closing date for sale of the property to November 15, 2007; however, no such written commitment was forthcoming and, instead, Wells Fargo relisted the property and entered into an agreement with a higher bidder. On November 15, 2007, Ms. Myers furnished her mortgage financing to Wells Fargo; however, Wells Fargo refused to close on the property and maintained that Ms. Myers was at fault in failing to close on the sale of the property by October 15, 2007. Ms. Myers sought specific performance and damages from Wells Fargo, and its divisions (WFHM and PAS), as well as U.S. Bank and Prudential.

¶ 8 The certified docket entries reveal that, on January 29, 2008, the sheriff served U.S. Bank with Ms. Myers' complaint. On February 6, 2008, Prudential filed preliminary objections to Ms. Myers' complaint, and Ms. Myers filed an answer. On February 19, 2008, Anne E. Walters, Esquire, entered her appearance on behalf of Wells Fargo, WFHM, and PAS, and on that same date, she filed an answer on their behalf to Ms. Myers' complaint. On February 21, 2008, Ms. Myers filed a Rule 237.5 Important Notice to enter default judgment due to U.S. Bank's failure to respond to Ms. Myers' complaint, and on March 5, 2008, Ms. Myers filed a praecipe to enter a default judgment against U.S. Bank. Notice of the default judgment was sent to U.S. Bank on March 5, 2008, in accordance with Pa.R.C.P. 236.

¶ 9 On March 19, 2008, Anne E. Walters, Esquire, entered her appearance on behalf of U.S. Bank, and on that same date, she filed on behalf of U.S. Bank a petition to open the default judgment. In its petition, U.S. Bank admitted that it was served with Ms. Myers' complaint at its registered Pennsylvania office, CT Corporation System, on approximately February 11, 2008, and counsel for U.S. Bank filed an entry of appearance and answer on behalf of WFHM and PAS, both divisions of Wells Fargo, on February 19, 2008. U.S. Bank further averred that "[d]ue to a clerical error and miscommunication between in-house counsel for defendants, [WFHM] and [PAS], and the undersigned, the undersigned did not file an Answer on behalf of moving Defendant, U.S. Bank[.]" U.S. Bank explained that it is the trustee for the loan on the property described in Ms. Myers' complaint and WFHM acts as the servicer of the loan. U.S. Bank requested that the default judgment be opened and averred that it has a meritorious defense, which was more fully explained in a proposed answer to Ms. Myers' complaint, which was attached as an exhibit to the petition to open.

¶ 10 On April 7, 2008, Ms. Myers filed an answer to U.S. Bank's petition to open the default judgment, and on April 11, 2008, she filed a praecipe for lis pendens requesting a lien be entered against the Springhouse Lane property. The trial court entered a Rule to Show Cause as to why U.S. Bank's petition to open the default judgment should not be granted.

¶ 11 On September 8, 2008, Ms. Myers filed a brief in opposition to U.S. Bank's petition to open the default judgment. By order entered on September 29, 2008, the trial court denied U.S. Bank's petition to open the default judgment, and on October 3, 2008, U.S. Bank filed a petition for reconsideration, along with a supporting memorandum. Ms. Myers filed an answer opposing reconsideration.

¶ 12 On October 29, 2008, U.S. Bank filed a notice of appeal to this Court from the trial court's September 29, 2008 order denying U.S. Bank's petition to open the default judgment.² On November 13, 2008, the trial court sent a letter to U.S. Bank indicating it was declining to address the motion for reconsideration since an appeal had been filed. Thereafter, pursuant to petitions filed by the parties, by order entered on December 9, 2008, the trial court stayed the action against Wells Fargo, Prudential, PAS, and WFHM pending the outcome of this appeal by U.S. Bank. On February 4, 2009, the trial court filed a Pa.R.A.P. 1925(a) opinion explaining the reasons it denied U.S. Bank's petition to open the default judgment. Specifically, the trial court concluded U.S. Bank's petition was not timely filed and U.S. Bank had failed to provide an adequate explanation for its delay.

¶ 13 On appeal, U.S. Bank contends that it met the three prongs of the tripartite test necessary for opening a default judgment.

It is well settled that a petition to open a default judgment is an appeal to the equitable powers of the court, and absent an error of law or a clear, manifest abuse of discretion, it will not be disturbed on appeal. An abuse of discretion occurs when a trial court, in reaching its conclusions, overrides or misapplies the law, or exercises judgment which is manifestly unreasonable, or the result of partiality, prejudice, bias or ill will.

US Bank N.A. v. Mallory, 982 A.2d 986, 994 (Pa.Super.2009) (quoting ABG Promotions v. Parkway Publishing, Inc., 834 A.2d 613, 615-16 (Pa.Super.2003) (en banc) (quotations, quotation marks, and citations omitted)).

¶ 14 Generally speaking, a default judgment may be opened if the moving party has (1) promptly filed a petition to open the default judgment, (2) provided a reasonable excuse or explanation for failing to file a responsive pleading, and (3) pleaded a meritorious defense to the allegations contained in the complaint.³ McFarland v. Whitham, 518 Pa. 496, 544 A.2d 929 (...