U.S. Bank v. McAfee

1

U.S. BANK, NATIONALASSOCIATION, AS TRUSTEE FOR CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP., HOME EQUITY ASSET TRUST 2006-1, HOME EQUITY PASS-THROUGH CERTIFICATES, SERIES 2006-1 Appellant v. JILL MCAFEE A/K/A JILL MCFEE AND JOHN MCAFEE

No. 882 WDA 2022

No. J-A06026-23

Superior Court of Pennsylvania

May 16, 2023

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

Appeal from the Judgment Entered July 14, 2022 In the Court of Common Pleas of Allegheny County Civil Division at No(s) GD16-006717

Joseph D. Seletyn, Esq.

BEFORE: OLSON, J., NICHOLS, J., and PELLEGRINI J.^[*]

MEMORANDUM

NICHOLS, J.

Appellant U.S. Bank, National Association appeals from the judgment entered in favor of Jill McAfee (Wife), a/k/a Jill McFee, and John McAfee (Husband) (collectively, Appellees) after a non-jury trial. Appellant argues that the trial court erred by admitting evidence of title insurance at trial, declining to apply the entireties presumption and reform the mortgage on Appellees' property, and failing to impose an equitable lien on Appellees' property. We affirm.

The trial court summarized the procedural history of this matter as follows:

The subject property in this case, 212 Maplewood Drive, Pittsburgh, PA, 15214, was purchased in 2005 (the "Property"). While the deed lists the grantees as "John McAfee and Jill McAfee, husband and wife," the mortgage executed at the closing was signed only by [Wife], who was also the only person who applied for the loan used to purchase this property. By virtue of an assignment of mortgage in November 2012, [Appellant] became the owner of the mortgage.

[Appellant] initiated this case in 2016 against [Appellees] as the owners of record in an action to quiet title. Following appellate review of an initial order granting summary judgment in favor of [Appellant,]^[FN1] [Appellant] was granted leave to amend the complaint to include a count for an equitable lien. Consistent with the initial complaint, among the relief requested in the amended complaint was a declaration that the entire Property, including the ownership interest of [Husband], was subject to the mortgage as a lien of first priority as of the date of recording on August 2, 2005. [Appellant] filed a second motion for summary judgment on September 4, 2019, seeking judgment in its favor based upon application of the entireties presumption. [Appellant's] second motion for summary judgment was denied by the Honorable Judge Joseph M. James' order dated June 23, 2020.

^[FN1] By order dated June 26, 2017, the Honorable Judge Joseph M. James granted [Appellant's] motion for summary judgment, and declared the mortgage a lien of first priority against the entire Property [on the theory that Husband's omission from the mortgage was a mutual mistake]. On appeal to the Superior Court, the order was reversed. [U.S. Bank Nat'l Ass'n for Credit Suisse First Boston Mortgage Sec. Corp., Home Equity Asset Tr. 2006-1, Home Equity Pass-Through Certificates, Series 2006-1 v. McAfee, 1102 WDA 2017, 2018 WL 3721357, at *3 (Pa. Super. filed Aug. 2, 2018) (unpublished mem.).]

Trial Ct. Op., 9/16/22, at 2-3 (some citations omitted and some formatting altered).

On March 16, 2022, Appellant filed a motion in limine to exclude evidence relating to Appellant's title insurance. See Appellant's Mot. in Limine, 3/16/22, R.R. at 189a-218a.^[1] Following a hearing on March 22, 2022, the trial court denied Appellant's motion and the matter immediately proceeded to a non-jury trial. N.T. Trial, 3/22/22, at 19.

The trial court summarized its factual findings as follows:

Unfortunately, [Wife] was unavailable to testify due to a medical condition and she was not deposed in the matter. However, the other witnesses with knowledge of the circumstances surrounding the loan transaction testified that [Wife] alone chose to pursue purchasing a new home and securing a loan despite [Husband] informing her that he did not want "anything to do with it." In his testimony at trial, [Husband] explained what motivated her to do so. Before purchasing this house, [Wife] was accidently mistaken by first responders as the mother of a victim in a gang related, . . . shooting that took place in Homestead, Pennsylvania. . . . Following this incident, [Wife] desired to move to the North Hills and away from Homestead. [Husband], a native of Homestead, did not want to leave.

[Husband] testified about his lack of involvement in the loan origination process and about his opposition to being involved in purchasing the home. [Husband] was not involved in the loan application process at all because as he testified, he did not want to move and "did not have anything to do with purchasing [the] property." While [Husband] was aware that [Wife] was trying to purchase a home, [Husband] did not think that [Wife] would actually purchase a house or that there would be a move. In response to a question regarding whether [Husband] told [Wife] not to take out a mortgage or buy the property, [Husband] unequivocally stated, "I told her I did not want anything to do with it, I did not want to live in this house." He also testified that he did not even expect to be listed on the deed.

The undersigned found [Husband's] testimony - that he voiced opposition to moving and to his involvement in the purchase to [Wife] - to be credible.

The plan to exclude [Husband] from the loan transaction was corroborated by David Howe, who in addition to being an employee of the ambulance service owned by [Husband], worked in the mortgage origination business in 2005. [Wife] approached Mr. Howe when she desired to move from Homestead. Mr. Howe specifically helped [Wife] to shop for banks that would lend to only one spouse and prepared the loan application only for [Wife]. He helped her fill out the application and affirmed that [Husband] was not a part of the process at any time. Mr. Howe did not prepare the final loan documents or attend the closing; once the application was submitted to the lender, his part was over.

At trial, [Appellant] called Tonya Johnson . . . who has been employed by Wells Fargo Bank, the current loan servicer, since March 12, 2012. She testified that as a loan servicer, Wells Fargo advances taxes, accepts the mortgage payments, and communicates with the borrower. Wells Fargo was not the lender at the time of closing.

As a senior loan documentation specialist, Ms. Johnson reviews and analyzes business records in preparation for court. Ms. Johnson testified about the record keeping at Wells Fargo (the loan servicer) and authenticated the business records. Ms. Johnson was not involved in the loan application process or loan closing process nor did she speak to anyone who was in preparation for her testimony.

Trial Ct. Op. at 3-6.

We add that Ms. Johnson testified that the mortgage has been in default since 2014. N.T. Trial at 59, 69. Additionally, the trial court admitted into evidence a letter dated June 2, 2015 from Appellant's counsel to Appellant's title insurance carrier, in which Appellant stated that its title search indicated that Husband did not execute the mortgage. Id. at 66-68, S.R.R. at 131b-32b (Defendants' Exhibit 18).

On March 29, 2022, the trial court entered a verdict in favor of the Appellees. Appellant filed a timely post-trial motion seeking JNOV, or in the alternative, a new trial, which the trial court denied. Appellant subsequently filed a timely notice of appeal and a court-ordered Pa.R.A.P. 1925(b) statement. The trial court issued a Rule 1925(a) opinion addressing

Appellant's claims. Appellant raises the following issues for our review, which we reorder as follows:

1. Was the trial court's admission of evidence at trial of title insurance coverage and/or a pending title insurance claim, prejudicial error?

2. Was the trial court's apparent conclusion that the Pennsylvania entireties presumption was inapplicable as to the validity of the instant mortgage and the binding nature of same on both Appellees, unsupported by the evidence and applicable law?

3. Was the trial court's failure to impose an equitable lien on the subject Property and on the ownership interests of both Appellees thereto, unsupported by the evidence and applicable law?

Appellant's Brief at 8.

Admission of Evidence Regarding Title Insurance

In its first issue, Appellant argues that the trial court erred in denying its motion in limine to preclude admission of any evidence relating to Appellant's title insurance. Id. at 15-16. Appellant contends that evidence concerning a party's insurance coverage is generally inadmissible under Pa.R.E. 411. Id. at 15. Appellant also argues that such evidence is irrelevant and prejudicial. Id. at 15-16 (citing, inter alia Stepanovich v. McGraw, 78 A.3d 1147 (Pa. Super. 2013); Est. of Hannis by Hannis v. Ashland State Gen. Hosp., 554 A.2d 574, 579 (Pa. Cmwlth. 1989)). Appellant concludes that the admission of evidence related to title insurance unfairly prejudiced Appellant. Id. at 16.

With respect to evidentiary rulings, this Court has explained:

Questions concerning the admissibility of evidence lie within the sound discretion of the trial court, and we will not reverse the court's decision absent a clear abuse of discretion. An abuse of discretion may not be found merely because an appellate court might have reached a different conclusion, but requires a manifest unreasonableness, or partiality, prejudice, bias, or ill-will, or such lack of support as to be clearly erroneous. In addition, to constitute reversible error, an evidentiary ruling must not only be erroneous, but also harmful or prejudicial to the complaining party.

Crespo v. Hughes, 167 A.3d 168, 177 (Pa. Super. 2017) (citations omitted and formatting altered).

Pennsylvania Rule of Evidence 411 ...