J-A05044-15
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
SANTANDER BANK, N.A., IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellee
v.
KING DRIVE CORP.; A LA CARTE
ENTERPRISES, INC.; ANGINO &
ROVNER, P.C. AND RICHARD C. ANGINO
AND ALICE K. ANGINO, H/W,
Appellants No. 2346 EDA 2014
Appeal from the Order Entered July 23, 2014
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): 0330 March Term, 2014
BEFORE: GANTMAN, P.J., SHOGAN, and ALLEN, JJ.
MEMORANDUM BY SHOGAN, J.: FILED APRIL 28, 2015
Appellants King Drive Corporation (“King Drive”), A La Carte
Enterprises, Inc. (“A La Carte”), Angino & Rovner, P.C., Richard C. Angino
and Alice K. Angino, h/w, (“Anginos”) (collectively “Appellants”), appeal from
a July 23, 2014 order from the Court of Common Pleas of Philadelphia
County, denying Appellants’ Petition to stay, strike, order discovery, hold a
hearing, or open judgment. We affirm.
The trial court summarized the facts of this case as follows:
Plaintiff Santander Bank (“Santander”) and defendants
King Drive Corporation (“King Drive”) and A La Carte Enterprises
(“A-La-Carte”), entered into a number of commercial loan
agreements beginning in 2007. Under these contractual
relationships, Santander agreed to provide funds to defendants
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for the development of a golf course and annexed facilities in
Dauphin County, Pennsylvania.
On July 3, 2007, Santander and King Drive executed a
Construction Loan and Security Agreement (“Loan No. 1”).
Under the terms of Loan No. 1, Santander agreed to provide to
King Drive funds in the amount of $2 million. The maturity date
of this loan, July 1, 2009, could be extended for one year subject
to the conditions contained in the Loan Agreement. The Loan
No. 1 agreement contained a pacing provision which required
borrower to sell a specified number of property lots within each
year. The promissory note on Loan No. 1 was guaranteed by
individual defendants Richard C. Angino and Alice K. Angino (the
“Anginos”). Furthermore, the promissory note on Loan No. 1
was secured by a mortgage on a property (the “Mockingbird
Drive Property”), which was owned by defendant King Drive.
On November 28, 2007, King Drive executed and delivered
to Santander a Mortgage Loan Note in the amount of $3.5
million for a second loan provided by Santander (Loan No. 2).
On the same date, King Drive also executed and delivered to
Santander a Line of Credit Promissory Note, in the amount of
$750,000, for a loan provided by Santander to cover the working
capital needs of King Drive (Loan No. 3). In addition, Loans Nos.
2 and 3 were secured by an Unlimited Guaranty and Suretyship
Agreement executed by the Anginos. This agreement was
accompanied by an “Explanation and Waiver of Rights Regarding
Confession of Judgment,” which was executed by the Anginos.
Pursuant to the language therein, the Anginos acknowledged
that Santander could exercise the right to confess judgment
against them.
On November 28, 20[07], defendant A-La-Carte executed
and delivered to Santander a Line of Credit Promissory Note for
a fourth loan (“Loan No. 4”), in the amount of $750,000.
Pursuant to the Line of Credit Promissory Note, A-La-Carte
empowered Santander to confess Judgment against A-La-Carte
in any court of record in Pennsylvania or elsewhere. Loan No. 4
was also guaranteed by the Anginos under an Unlimited
Guaranty and Suretyship Agreement dated November 28,
20[07]. The above mentioned guaranty and suretyship
agreement was also backed by an Explanation and Waiver of
Rights Regarding Confession of Judgment. Pursuant to the
language in the waiver, the Anginos “irrevocably and
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unconditionally” waived any immunity for themselves, their
properties and assets, in the event of any legal suit arising under
Loan No. 4. In addition, Loan No. 4 was also guaranteed under
the terms of an Unlimited Guaranty and Suretyship Agreement
executed by Angino & Rovner, P.C. (“Angino & Rovner”), a law
firm controlled in whole or in part by individual defendant
Richard C. Angino, Esquire.
On July 14, 2011, Santander and defendants entered into
a “Loan Modification Agreement.” Pursuant to this loan
modification, the maturity date for repayment of all loans was
extended to December 31, 2013. In addition, defendants King
Drive, A-La-Carte, Angino & Rovner, Richard C. Angino and Alice
K. Angino, agreed to supplement collateral security to the loans
with additional mortgages upon the residence and vacation home
of the Anginos, as well as a separate parcel of land owned by
defendants.
On July 19, 2012, the parties entered into a “First
Amendment to Agreement Modification of July 14, 2011.” On
December 27, 2012, the parties entered into a Second
Amendment to the Modification Agreement dated July 14, 2011.
The original loan modification agreement and its two
amendments contained warrants of attorney to confess
judgment against each defendant in any court of record.
On February 1, 2013, the instant defendants filed a
complaint in the Court of Common Pleas, Berks County, against
Santander’s predecessor in interest and two other parties. The
complaint asserted claims which included breach of contract,
breach of fiduciary duty and breach of the duty of good faith and
fair dealing. On June 25, 2013, the Court of Berks County
sustained the preliminary objections to the complaint, dismissed
the complaint in its entirety, and granted the instant defendants
leave to file an amended complaint. On July 11, 2013, the
instant defendants filed an amended complaint in the Court of
Berks County against Santander’s predecessor in interest and
another defendant, Weir and Partners, LLP. However, the Berks
County court found that the amended complaint offered
allegations which were substantially similar to those asserted in
the original complaint. Consequently, the court in Berks County
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again sustained the preliminary objections to the amended
complaint. Herein defendants filed an appeal which is still
pending before the Pennsylvania Superior Court.1
By letter dated July 17, 2013, Santander informed the
Anginos that they were in default for failure to pay to Santander
$500,000 as required pursuant to the modifications to the loan
agreements executed by the parties. The letter gave the
Anginos ten (10) days to cure the default. None of the instant
defendants was able to cure.
On March 20, 2014, Santander filed a praecipe for entry of
judgment confession with an accompanying complaint. On April
17, 2014, all defendants in the instant action filed a petition to
stay, strike, order discovery, hold a hearing, and/or open
judgment, accompanied by a memorandum of law. Santander
timely filed a response and memorandum of law in opposition to
the petition of defendants. On June 5, 2014, the parties met at
an unsuccessful settlement conference chaired by a Court-
appointed Judge pro-tempore. Subsequently, the Court held a
hearing on July 9, 2014.
Trial Court Opinion, 7/24/14, at 1–5 (footnotes omitted). On July 24, 2014,
the trial court denied Appellants’ petition. Appellants filed a timely appeal.
Appellants’ brief describes the issues on appeal as follows:2
1. Did the trial court err when Defendants requested a
hearing and an opportunity to be heard, the trial court
scheduled a hearing, but refused to permit Defendants to
call witnesses or offer exhibits and limited defense counsel
to a brief oral argument?
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1
On January 18, 2015, a panel of this court affirmed the Berks County
court order sustaining the preliminary objections to Appellants’ amended
complaint. Angino, et al. v. Santander, et al, No. 489 MDA 2014 (Pa.
Super. filed January 28, 2015) (unpublished memorandum at 15). On April
2, 2015, Appellants’ petition for reargument en banc was denied.
2
The trial court did not order Appellants to file a Pa.R.A.P. 1925(b)
statement of errors complained of on appeal.
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2. Should the Santander Confession of Judgment be opened
based upon the meritorious defenses presented in the
instant law suit that include identical issues in the Court of
Common Pleas of Berks County involving the same parties
in reverse roles, Civil Action - Law - Equity, No. 13-1563,
under the principal of lis pendens which is currently on
appeal to the Superior Court based upon the trial court’s
grant of Santander’s preliminary objections to Plaintiffs
Amended Complaint with prejudice. The following
meritorious issues have been raised and are pending from
Plaintiffs’ Amended Complaint and present Defendants’
appeal to the Superior Court including the following:
a. Does [there] exist a duty of good faith and fair dealing in
the lender/lendee context in Pennsylvania in certain
situations?
b. Do the factual averments in Plaintiffs’ Berks County
Amended Complaint aver sufficient facts to present to a
jury Santander’s violation of its duty of good faith in the
context of Santander’s threat of foreclosure, coerced
forebearance agreement, the terms of the forebearance
agreement, First and Second Amendments, and refusal to
cooperate with Defendants in obtaining refinancing and/or
sale[s] of parcels of Defendants’ secured property and
therefore constitute meritorious defenses in the instant
Confession of Judgment action?
c. Did Santander commit a breach of contract when it
revoked irrevocable letters of credit due to the
Defendants?
d. Do the factual averments in Defendants’ Amended
Complaint in the Berks County action and the supporting
exhibits evidence or state a claim for breach of contract
under the reasonable expectations doctrine?
e. Do the factual averments in Defendants’ Amended
Complaint in the Berks County action and the exhibits
evidence or state a claim for breach of contract under the
defense of impracticability?
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f. Do the factual averments in Defendants’ Amended
Complaint in the Berks County action and the exhibits
evidence or state a claim for breach of contract under the
defense of waiver or estoppel?
g. Do the factual averments in Defendants’ Amended
Complaint in the Berks County action and the exhibits
evidence or state a claim for breach of contract under the
tort of civil conspiracy?
h. Do the factual averments in Defendants’ Amended
Complaint in the Berks County action and the exhibits
evidence or state a claim for breach of contract under the
tort of defamation?
i. Do the factual averments in Defendants’ Amended
Complaint in the Berks County action and the exhibits
evidence or state a claim for breach of contract under the
tort of fraud?
Appellants’ Brief at 5–6 (verbatim).
Appellants’ argument that the trial court erred in denying them a
hearing on the merits of their petition to open judgment because they were
not permitted to call witnesses, offer exhibits, or produce evidence, is
impossible to evaluate. What is known is that the trial court held a hearing
on Appellants’ motion on July 9, 2014. Appellants did not file any discovery
requests prior to the hearing. The record does not indicate that Appellants
requested that the hearing be transcribed. More importantly, the record on
appeal does not include a transcript of the hearing as required by the
Pennsylvania Rules of Appellate Procedure. See Pa.R.A.P. 1911(a)
(announcing general rule that Appellant shall request any transcript required
for appeal) and Pa.R.A.P. 1921 (the transcript of proceedings, inter alia,
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shall constitute the record on appeal). Nor did Appellants attempt to comply
with the procedure outlined in Pa.R.A.P. 1923 regarding statements in
absence of transcript. Without a transcript we are unable to determine what
transpired at the hearing. We cannot discern whether a request for an
expanded hearing was presented, or the trial court’s response, if any, to
such a request. Since the record in this case does not contain the facts
necessary to evaluate the validity of Appellants’ argument on this issue, we
cannot consider it on appeal. Conner v. Daimler Chrysler Corp., 820 A.2d
1266, 1273 (Pa. Super. 2003).3
Appellants also argue that the trial court erred in denying their petition
to open the judgment. A petition to open the judgment is governed by
Pa.R.C.P. 29594 and is an appeal to the equitable powers of the court.
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3
In its Memorandum Opinion denying Appellants’ motion, the trial court did
not specifically address whether it met its obligation concerning the extent of
the hearing it conducted on Appellants’ petition. The trial court, however,
observed in a footnote that:
‘in the context of a judgment confessed . . . the hearing required
to comport with due process means simply an opportunity to be
heard; it does not require a proceeding comparable to a full trial,
but may be satisfied by other procedural opportunities to be
heard, such as a petition to open judgment . . . .’
Trial Court Opinion, 7/24/14, at 5 n.17 (quoting Dollar Bank, Federal
Savings Bank v. Northwood Cheese Co., Inc., 637 A.2d 309, 313 (Pa.
Super. 1994)) (citation omitted).
4
Rule 2959 provides generally that:
(Footnote Continued Next Page)
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Crum v. F.L. Shaffer Co., 693 A.2d 984, 986 (Pa. Super. 1997). As such,
it is committed to the court’s sound discretion. PNC Bank v. Kerr, 802
A.2d 634, 638 (Pa. Super. 2002). Relief may be granted only where the
petitioner presents evidence of a meritorious defense that is “clear, direct,
precise, and believable.” Germantown Savings Bank v. Talacki, 657
A.2d 1285, 1289 (Pa. Super. 1985) (citation omitted). The burden rests on
the party against whom judgment was confessed to disprove the facts
contained within the confession of judgment. Davis v. Woxall Hotel, Inc,
577 A.2d 636, 638 (Pa. Super. 1990). Ordinarily, an order denying the
petition will not be disturbed absent a manifest abuse of the trial court’s
discretion. Smith v. Friends Hospital, 928 A.2d 1072, 1074 (Pa. Super.
2007).
Appellants contend that the confession of judgment entered should be
opened under the principle of lis pendens in that the meritorious defenses
presented in this action encompass the identical issues litigated in the Berks
_______________________
(Footnote Continued)
(a)(1) Relief from a judgment by confession shall be sought
by petition. Except as provided in subparagraph (2), all grounds
for relief whether to strike off the judgment or to open it must
be asserted in a single petition. The petition may be filed in the
county in which the judgment was originally entered, in any
county to which the judgment has been transferred or in any
other county in which the sheriff has received a writ of execution
directed to the sheriff to enforce the judgment.
Pa.R.C.P. 2959.
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County action that Appellants initiated against Santander. These issues
include: 1) the existence of a duty of good faith and fair dealing in the
lender-borrower context; 2) whether Santander breached this duty; 3)
Santander breached a contract when it revoked lines of credit; 4) breach of
contract under reasonable expectations doctrine; 5) breach of contract under
defense of impracticability; 6) breach of contract under defense of waiver or
estoppel; 7) breach of contract under tort of civil conspiracy; 8) breach of
contract under tort of defamation; and 9) breach of contract under tort of
fraud. Appellants’ Brief at 5–6.
In Pennsylvania, “[w]hen two lawsuits are pending, the common law
doctrine of lis pendens permits the dismissal of the newer suit if both suits
involve the same parties, the same relief requested, the same causes of
action, and the same rights asserted.” Barren v. Commonwealth, 74 A.3d
250, 253 (Pa. Super. 2013). Additionally, “an abeyance may be appropriate
even where the petitioner cannot strictly meet the above-referenced test if
the two actions would ‘create a duplication of effort on the part of the parties
and waste judicial resources by requiring two courts of common pleas to
litigate a matter that in all likelihood could be fully addressed in one forum.’”
PNC Bank, National Association v. Bluestream Technology, Inc., 14
A.3d 831, 835 (Pa. Super. 2010) (quoting Norristown Automobile Co.,
Inc. v. Hand, 562 A.2d 902, 905 (Pa. Super. 1989)).
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Although we review a trial court’s order denying a petition to open for
abuse of discretion, we review de novo whether lis pendens operates as a
meritorious defense. Id., 14 A.3d at 835. The trial court determined that
Appellants could not rely on lis pendens to open the judgment because the
case before it did not involve two pending actions: “Santander’s instant
judgment by confession is not a pending lawsuit but a mere ministerial act
performed by the Office of the Prothonotary, whose duty is to merely enter
the judgment by confession in accordance with the Pennsylvania Rules of
Civil Procedure.” Trial Court Opinion, 7/24/14, at 11 (citation omitted).
While on its face a judgment of confession is an administrative function,
when Appellants filed a petition to open this judgment, the proceeding was
converted into a lawsuit. Therefore, the trial court erred in its
characterization of the entry of the judgment of confession as a clerical task
and in rejecting Appellants’ lis pendens argument on this basis.
Nevertheless, we conclude that Appellants’ lis pendens argument is
unavailing because it is moot. On January 28, 2015, the panel in Appellants’
appeal of the Berks County case issued a decision affirming the trial court’s
order sustaining Santander’s preliminary objections to Appellants’ complaint.
Angino, et al. v. Santander, et al, No. 489 MDA 2014 (Pa. Super. filed
January 28, 2015) (unpublished memorandum at 15). On April 2, 2015,
Appellants’ petition for reargument before this Court en banc was denied.
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Thus, there is no pending lawsuit implicating application of lis pendens
principles.
An additional consideration is that the panel in Angino, et al. v.
Santander, et al., addressed and rejected each of the defenses raised by
Appellants in this appeal. Angino, slip op. at 7–15. Accordingly, it is not
within our province to adjudicate the merits of the defenses raised by
Appellants. It is beyond the power of a panel of the Superior Court to
overrule a prior decision of the Superior Court. Commonwealth v.
Hull, 705 A.2d 911, 912 (Pa. Super. 1998) (citations omitted).5
Accordingly, we affirm the order of the trial court, albeit for different
reasons. Order affirmed.
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5
Appellants also presented a one-paragraph argument that venue in the
Philadelphia County Court of Common Pleas was improper. This issue is
waived because it was not put forth in Appellants’ statement of questions
involved nor was it developed in any meaningful manner. See Pa.R.A.P.
2116(a) (“No question will be considered unless it is stated in the statement
of questions involved or is fairly suggested thereby”); Banfield v.
Cortes, ___ A.3d ___, 2015 WL 668060, *18, 83 MAP 2013 (Pa. 2015)
(filed February 17, 2015) (where appellate brief fails to develop issue in any
meaningful fashion capable of review, claim is waived).
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/28/2015
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