Phila. Fed. Credit Union v. Bass

287 A.3d 860 (Table)

PHILADELPHIA FEDERAL CREDIT UNION

v.Renoda K. BASS

Appeal of: BMRK Lending, LLC

No. 74 EDA 2022

Superior Court of Pennsylvania.

Filed October 13, 2022

MEMORANDUM BY LAZARUS, J.:

BMRK Lending, LLC, (BMRK) appeals from the order, entered in the Court of Common Pleas of Philadelphia County, denying its petition to intervene in the underlying confession of judgment action.¹ BMRK filed its petition to intervene on September 20, 2021.² However, the Mortgaged Premises and the 77^th Street Premises were sold at sheriff's sale seven months prior, on February 4, 2020, in partial satisfaction of the confessed judgment in the amount of $352,913.22, which was entered on August 7, 2019. The sheriff's deed was acknowledged on August 25, 2020 and PFCU filed a deficiency judgment petition on February 11, 2021, which the court granted on March 2, 2021. The court denied BMRK's petition as it was not filed during the pendency of the action, in accordance with Pa.R.C.P. 2327. After our review, we quash this appeal.

On May 3, 2022, this Court entered an order directing BMRK, within ten days, to show cause why the appeal should not be quashed as interlocutory or dismissed as moot.³ Inexplicably, BMRK did not respond. On May 24, 2022, this Court discharged the show-cause order, referring the matter to this panel. See Order, 5/24/22.

The trial court set forth the underlying facts of this case as follows:

On August 7, 2019, [ ] Philadelphia Federal Credit Union [PFCU] filed a complaint for confession of money judgment against Renoda K. Bass [Bass] stating [Bass] was indebted to [PFCU] in the amount of $352,913.22 including interest. [PFCU] also attached evidence of a loan agreement and mortgage between the parties. [ ] On November 12, 2019, [PFCU] filed a praecipe for writ of execution upon the confessed judgment amount requesting the prothonotary issue a writ of execution for two (2) parcels of property owned by [Bass] located at 7627 Este Avenue, Philadelphia, PA 19153, and 2541-43 S. 77^th Street, Philadelphia PA 19153 (Subject Properties). The filing further requested that the Philadelphia Sheriff's Office issue a levy and sell [Bass's] interest in the Subject Properties to satisfy the judgment. [ ] Subsequently, [filed multiple affidavits of service, certifying it had served notice upon several interest parties[,] including [Bass], additional creditors[,] as well as lien holders that may have had an interest in the Subject Properties.

On February 4, 2020, the property located at 7627 Este Avenue, Philadelphia, PA 19153, [the Mortgaged Premises], was sold at sheriff's sale. On February 11, 2021, [PFCU] filed a petition to fix fair market value and establish amount of deficiency claim (Deficiency Petition) requesting the fair market value of the property sold at sheriff sale be set at $260,000.00 and be offset against the pending judgment of $381,719.10.^[4]

On March 2, 2021, this [c]ourt granted [PFCU's D]eficiency [P]etition and established a deficiency claim for monetary judgment against [Bass] in the amount of $163,209.09. Subsequently, on March 9, 2021, [PFCU] filed an affidavit of service for the [D]eficiency [P]etition indicating personal service had been effectuated upon [Bass] on March 4, 2021. [PFCU] also indicated it had successfully mailed notice to [Bass's] address of record listed on this [c]ourt's docket prior to this [c]ourt's ruling on the [Deficiency] Petition.

On September 14, 2021, [PFCU] filed a second praecipe for writ of execution upon the confessed judgment for the remaining deficiency balance including additional accrued costs. This time, [PFCU] requested the Prothonotary issue a writ of execution for another parcel of property owned by [Bass] located at 4768 Tacony Street, Philadelphia, PA ("the [Tacony] Property").

On September 20, 2021, BMRK [ ] filed a motion to intervene. In its motion, [BMRK] indicated it held a mortgage against the [Tacony] Property and possessed proper standing to intervene in this proceeding to protect its interest. [BMRK] also indicated that service and notice of the "Deficiency Petition" in this matter were not properly effectuated consistent with Pa.R.C.P. 3283 and Pa.R.C.P. 3284(1). On October 4, 2021, [PFCU] filed a response to [BMRK]’s petition to intervene, requesting this [c]ourt deny its petition[,] indicating service was properly effectuated by mail to [Bass's] residence as well as via personal service on March 4, 2021.

On November 16, 2021, this [c]ourt entered an order denying [BMRK]’s petition to intervene because the petition was not filed during the pendency of this action as required by Pa.R.C.P. 2327.

Trial Court Opinion, 4/19/22, at 1-4 (footnotes and unnecessary capitalization omitted; footnote 3 added).

BMRK filed this timely appeal. Both BMRK and the trial court have complied with Pa.R.A.P. 1925.

BMRK raises the following issues for our review:

1. Can a party intervene in an action to protect its interest in real estate from execution on an invalid deficiency judgment, where the proposed intervenor did not have an interest in the real estate prior to the entry of the original judgment?

2. Is a deficiency judgment validly entered where the petition to fix fair market value omits property acquired pursuant to the execution proceeding on the original judgment?

3. Is a deficiency judgment validly entered where (i) the petition to fix fair market value was not served in accordance with Pa.R.C.P. 3283(a)(2), (ii) the creditor did not file a return of service for the petition as required by Pa.R.C.P. 3283(b), and (iii) the creditor did not serve a Rule 237.1 notice as required by Pa.R.C.P. 3284(1) ?

Appellant's Brief, at 2 (reordered for ease of disposition).

Generally, an appellate court only has jurisdiction to review final orders. See Pa.R.A.P. 341 (providing that "an appeal may be taken as of right from any final order"). The official note to Pa.R.A.P. 341 explains: "[A]n order denying a party the right to intervene" is no longer considered an appealable final order but, in appropriate cases, may "fall under Pa.R.A.P. 312 (Interlocutory Appeals by Permission) or Pa.R.A.P. 313 (Collateral Orders)." Id. , note.

Here, BMRK did not seek the trial court's permission to appeal pursuant to Rule 312. Therefore, unless the order denying its petition to intervene can be classified as a collateral order pursuant to Rule 313, we are without jurisdiction to entertain the instant appeal.

The Pennsylvania Rules of Appellate Procedure set forth three conditions that must be present for an order to be defined as collateral. The order must be "[1] separable from and collateral to the main cause of action [2] where the right involved is too important to be denied review [3] and the question presented is such that if review is postponed until final judgment in the case, the claim will be irreparably lost." Pa.R.A.P. 313(b). In order "[t]o benefit from the collateral order doctrine, an order must satisfy all three elements." Radakovich v. Radakovich , 846 A.2d 709, 714 (Pa. Super. 2004) (citation omitted). See Financial Freedom, SFC v. Cooper , 21 A.3d 1229 (Pa. Super. 2011) (holding Rules of Civil Procedure do not permit intervention after matter has been finally resolved).

Here, we find the first two prongs of Rule 313 ’s collateral order test are satisfied. The order denying BMRK's petition to intervene is separate from and collateral to the confessed judgment action. Further, BMRK avers the order denying the petition to intervene affects its property interest, which is deeply rooted in public policy going beyond the underlying litigation. See Mortgage Electronic Registration Systems, Inc. v. Malehorn , 16 A.3d 1138, 1141-42 (Pa. Super. 2011) (order denying mobile home owner's motion to intervene in foreclosure action failed to satisfy collateral order doctrine and thus was not immediately appealable). However, we find that the third prong, requiring that the question presented is such that if review is postponed until final judgment, the claim will be irreparably lost, cannot be met here. Simply put, judgment was entered almost 18 months before BMRK filed its motion to intervene.

BMRK argues, however, that PFCU's deficiency judgment action somehow renders the underlying matter "pending." For the following reasons, we disagree.

The determination of who may intervene in an action and when that intervention may be prohibited is determined by Pa.R.C.P. 2327 and 2329. See Nemirovsky v. Nemirovsky , 776 A.2d 988, 992 (Pa. Super. 2001). Rule 2327 provides in pertinent part:

At any time during the pendency of an action , a person not a party thereto shall be permitted to intervene therein, subject to these rules if

(1) the entry of a judgment in such action or the satisfaction of such judgment will impose any liability upon such person to indemnify in whole or in part the party against whom judgment may be entered; or

(2) such person is so situated as to be adversely affected by a distribution or other disposition of property in the custody of the court or of an officer thereof; or

(3) such person could have joined as an original party in the action or could have been joined therein; or

(4) the determination of such action may affect any legally enforceable interest of such person whether or not such person may be bound by a judgment in the action.

Pa.R.C.P. 2327 (emphasis added).

An action or suit is "pending," as required for a court to allow intervention by a party, from its inception until the rendition of final judgment. U.S. Bank National Association for Pennsylvania Housing Finance Agency v. Watters , 163 A.3d 1019 (Pa. Super. 2017). See Newberg by Newberg v. Board of Public Educ. , 478 A.2d 1352 (Pa. Super. 1984) (petition for leave to intervene must be filed during pendency of action; petition filed after final adjudication is too late). Further, "where a court no longer has power to permit intervention because a matter has been finally adjudicated, a hearing on a petition to...