U.S. Bank National Assoc. v. Cannon, M.
406 EDA 2016
| Pa. Super. Ct. | Feb 3, 2017Background
- U.S. Bank (as Trustee) filed an in rem mortgage foreclosure against Michael and Ann Cannon on Feb. 19, 2014; a bench trial occurred on Sept. 29, 2015 and judgment was entered Feb. 26, 2016.
- Appellee prosecuted the case as holder of the original promissory note (endorsed in blank) and as record mortgagee via a Corrective Assignment of Mortgage recorded in Delaware County.
- Appellee’s servicing agent (Wells Fargo) provided a verification and custodian witness (Georgeann Sandstrom) who authenticated business records and the loan history.
- Appellants raised multiple challenges: Appellee’s business address and qualification to do business in PA; the validity of an assignment (including a notary seal error); admissibility/authentication of records and witness competency; lack of complaint verification by an officer; and gaps in the loan history.
- The trial court found Appellee was entitled to foreclose as holder of the note and record mortgage; Appellants lacked standing to challenge the assignment; the servicing witness properly authenticated records; and the verification complied with Pa.R.C.P. 1024.
Issues
| Issue | Plaintiff's Argument (U.S. Bank) | Defendant's Argument (Cannon) | Held |
|---|---|---|---|
| Standing / qualification to do business in PA | Not required to be registered; Trustee not "doing business" in PA | Appellee lacked standing because it did not disclose PA business location or qualification | Court: Appellee was not "doing business" in PA under applicable statute and registration was not required; standing exists as holder of the note/mortgage |
| Assignment validity / right to challenge assignment | Appellee is holder and record mortgagee via corrective assignment | Appellants attack assignment and notary error as invalidating transfer | Court: Appellants lack standing to challenge assignment between transferor/transferee; corrective assignment cures clerical error; Appellee entitled to enforce note/mortgage |
| Authentication of records / competency of witness | Servicer’s employee (Sandstrom) authenticated business records and loan history under business records exception | Appellants argued sole witness was not employed by Appellee and lacked personal knowledge | Court: Servicer custodian qualified to authenticate records; admission under business‑records exception was proper |
| Verification of complaint | Verification by Wells Fargo servicing officer sufficed under Pa.R.C.P. 1024(c) | Complaint invalid because not verified by an Appellee officer | Court: Verification by servicing agent complied with Rule 1024; claim waived when inadequately briefed |
Key Cases Cited
- Levitt v. Patrick, 976 A.2d 581 (Pa. Super. 2009) (standard of review in non‑jury bench trials)
- Walnut Street Assocs., Inc. v. Brokerage Concepts, Inc., 982 A.2d 94 (Pa. Super. 2009) (standard for reversing denial of new trial/JNOV)
- J.P. Morgan Chase Bank, N.A. v. Murray, 63 A.3d 1258 (Pa. Super. 2013) (mortgagor lacks standing to challenge assignments between parties)
- U.S. Bank, N.A. v. Pautenis, 118 A.3d 386 (Pa. Super. 2015) (business‑records hearsay exception and authentication)
- Boyle v. Steiman, 631 A.2d 1025 (Pa. Super. 1993) (witness need not have made entries personally to authenticate business records)
- Bank of Am., N.A. v. Gibson, 102 A.3d 462 (Pa. Super. 2014) (endorsement in blank makes note enforceable by holder/bearer)
- Cunningham v. McWilliams, 714 A.2d 1054 (Pa. Super. 1998) (holder of mortgage may institute foreclosure upon mortgagor default)