Mortgage Foreclosure, Service of Complaint on Alleged Equitable Owner in Possession

Bank of New York Mellon v. Pogonovich, 2017 WL 6728544 (Pa. Super. 2017), allocatur granted Aug. 28, 2018, appeal docket 29 WAP 2018

The Bank of New York filed an ejectment action against Karl M. Pogonovich seeking to remove Pogonovich from the residence located in Smith Township, Washington County. The Bank had acquired the premises by Sheriff’s deed dated June 16, 2010, following the mortgage foreclosure and judicial sale by the Washington County Sheriff on June 4, 20l0. Pogonovich responded, alleging that he had an equitable interest in the premises by virtue of an unrecorded installment land contract with the previous owners, the mortgagors who lost the property to Bank in the foreclosure proceedings. After a bench trial, the trial court granted judgment of possession to the bank.  Pogonovich thereafter filed post-trial motions and two successive bankruptcy proceedings. Automatic stays in the bankruptcy proceedings allowed Pogonovich to remain in possession and prevented the trial court from resolving post-trial motions in the ejectment action.  After the Bankruptcy Court granted relief from the automatic stay in the second bankruptcy proceeding, the trial court denied Pogonovich’s post-trial motions and Pogonovich appealed to the Superior Court.  The trial judge wrote an opinion, which the Superior Court in its unpublished memorandum adopted.

The trial court’s opinion reveals that at trial in the ejectment action, Pogonovich admitted that he had been personally served with the complaint in mortgage foreclosure that had been filed against the owner of record, that he was aware that the premises had been posted with the foreclosure proceedings, that he was aware of the judgment of foreclosure, that he was aware of the Sheriff’s sale  and was personally served with notice of it, that he did nothing to contest the foreclosure proceedings or the Sheriff’s sale, and that he did not thereafter attempt to set aside the Sheriff’s sale.

As the trial court found and stated in its opinion, Pogonovich was:

[P]roperly served with the underlying mortgage foreclosure proceedings by which the Bank became the owner of the premises. In addition to the testimony and evidence offered by the Baiik, defendant admitted that he had been personally served and that he was aware that the premises had been posted with the notice of the foreclosure proceedings.  Defendant farther admitted that, although he had been served with the foreclosure proceedings and the notice of Sheriff’s sale, and although he was represented at the time, he took no action to contest the foreclosure proceedings or the sale, nor did he attempt to set aside the Sheriff’s sale thereafter.

Trial Court Op. at 6.

The Supreme Court granted Pogonovich’s allocatur petition.   The issues, rephrased for clarity, are:

(1) Did the Superior Court depart from accepted judicial practices or abuse its discretion in finding as fact that Petitioner admitted to being personally served with the complaint in mortgage foreclosure?

(2) Did the Superior Court depart from accepted judicial practices or abuse its discretion in concluding as a matter of law that Petitioner had been served with original process with the underlying foreclosure complaint?

Allocatur grants present an excellent opportunity for your group or association to advance your legal and policy goals by filing an amicus brief. Participating as an amicus has proven to be an effective method of advising and influencing courts and often can involve far fewer resources than traditional lobbying.

If you are interested or would like more information, contact Kevin McKeon or Dennis Whitaker.