Generation Mortg. Co. v. Bung Thi Nguyen
138 A.3d 646
| Pa. Super. Ct. | 2016Background
- Generation Mortgage filed a mortgage foreclosure complaint against Bung Thi Nguyen for property at 6347 Kinsessing Ave on April 10, 2013, alleging default.
- Nguyen answered in forma pauperis, raised new matter and affirmative defenses including lack of standing, premature commencement under Act 6 (usury/residential mortgage notice), lack of subject-matter jurisdiction, and breach of contract.
- Generation moved for summary judgment twice; both motions were denied or held premature by the trial court.
- Parties attended a settlement conference; Generation filed a praecipe to discontinue the foreclosure on January 15, 2015, and the case was marked discontinued on January 20, 2015.
- Nguyen filed a timely motion for attorneys’ fees under §503 of Act 6, claiming she was the prevailing party due to the discontinuance and arguing Generation failed to provide required Act 6 notice; the trial court denied the fee motion on April 6, 2015.
- Nguyen appealed; the Superior Court affirmed, concluding discontinuance terminated the action without merits adjudication and that §503 did not authorize fees for prevailing in a foreclosure action that does not “arise under” Act 6.
Issues
| Issue | Plaintiff's Argument (Nguyen) | Defendant's Argument (Generation) | Held |
|---|---|---|---|
| Whether trial court lacked jurisdiction to rule on Nguyen’s fee motion after discontinuance | Trial court lost jurisdiction when defendant discontinued case before the fee motion | Trial court retained authority but denied fees on merits because Nguyen was not a prevailing party under Act 6 | Denied that jurisdictional error occurred; court ruled on merits and affirmed denial |
| Whether trial court should have adjudicated Nguyen’s Act 6 §403 notice defense after discontinuance | Court should decide whether §403 notice was defective and thus entitles Nguyen to relief | Discontinuance ended the case and rendered the Act 6 defense moot | Discontinuance deprived court of jurisdiction to decide merits; §403 issue moot |
| Whether Nguyen was a "prevailing party" under §503 of Act 6 by virtue of the discontinuance | Discontinuance made Nguyen the prevailing party entitling her to statutory attorneys’ fees under §503 | §503 applies only where the action arises under Act 6; foreclosure action does not arise under Act 6, so no fee award | Nguyen not entitled to fees under §503 because foreclosure action does not arise under Act 6; discontinuance alone doesn’t grant §503 fees |
| Whether Gardner and related precedents require awarding fees where action discontinued | Gardner treated discontinuance in confessed-judgment context as prevailing (supports Nguyen) | Gardner is distinguishable (confessed-judgment actions arise under Act 6); other cited cases involved merits victories preventing execution on confessed judgments | Court distinguished Gardner and similar cases and declined to extend them to foreclosure actions; affirmed denial of fees |
Key Cases Cited
- Miller Elec. Co. v. DeWeese, 907 A.2d 1051 (Pa. 2006) (jurisdictional/fee-procedure principles cited)
- Motley Crew, LLC v. Bonner Chevrolet Co., Inc., 93 A.3d 474 (Pa. Super. 2014) (discontinuance terminates action without merits adjudication)
- Wells Fargo Bank, N.A. v. Spivak, 104 A.3d 7 (Pa. Super. 2014) (Act 6 functions as a pre-foreclosure notice requirement; Act 6 typically raised as a defense)
- Doctor's Choice Physical Med. & Rehab. Ctr., P.C. v. Travelers Pers. Ins. Co., 128 A.3d 1183 (Pa. 2015) (Pennsylvania follows American rule: fees recoverable only if statute or contract authorizes)
- Gardner v. Clark, 503 A.2d 8 (Pa. Super. 1986) (confessed-judgment context awarding fees where action arose under Act 6; distinguished by court)