Fernandez, K. v. Peoples Security Bank

J-A10010-25

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37

KRISTY FERNANDEZ, INDIVIDUALLY : IN THE SUPERIOR COURT OF AND ON BEHALF OF ALL OTHERS : PENNSYLVANIA SIMILARLY SITUATED : : Appellant : : : v. : : No. 3168 EDA 2024 : PEOPLES SECURITY BANK AND : TRUST COMPANY :

Appeal from the Order Entered November 13, 2024 In the Court of Common Pleas of Montgomery County Civil Division at No(s): 2024-18819

BEFORE: PANELLA, P.J.E., BECK, J., and FORD ELLIOTT, P.J.E. * MEMORANDUM BY PANELLA, P.J.E.: FILED JUNE 5, 2025

Kristy Fernandez, individually and on behalf of all others similarly situated, appeals from the order sustaining preliminary objections filed by Peoples Security Bank and Trust Company (“the Bank”) and striking Fernandez’s complaint. We affirm based on the trial court’s opinion.

We glean the following pertinent background facts from our independent review of the record. Fernandez purchased a pre-owned Dodge Durango (“Vehicle”) on July 6, 2020, which was financed by the Bank. In June 2024, the Bank declared a default for Fernandez’s failure to pay the monthly installment and repossessed the Vehicle. The Bank provided Fernandez with a ____________________________________________

• • Retired Senior Judge assigned to the Superior Court.

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”Notice of Our Plan to Sell Property” (“Post-Repossession Notice”) on June 10, 2024. The Bank sold the Vehicle in July 2023, and provided Fernandez with notice of the sale results (“Post-Sale Notice”).

On July 31, 2024, Fernandez initiated this action by filing a complaint in class action (the “Complaint”), asserting a claim under the Uniform Commercial Code (“UCC”). The single count in the Complaint asserts the Bank violated Pennsylvania’s UCC by “failing to provide proper notice of disposition of collateral” and “by failing to provide proper notice of the calculation of a deficiency or surplus.” Complaint, 7/31/24, at ¶¶ 49-50.

On September 13, 2024, the Bank filed preliminary objections to the Complaint, with an accompanying brief in which the Bank maintained, in pertinent part, that Fernandez’s claims failed as a matter of law for the following reasons: (1) the Post-Repossession Notice contained the exact model notice language and (2) the Post-Sale Notice claim failed because the Bank was not required to send a deficiency notice where the Bank did not attempt to collect any deficiency balance. See Preliminary Objections, 9/13/24, at ¶¶ 6-7, 32, 43. Fernandez filed a responsive brief in opposition to the preliminary objections. Following a review and consideration of the pleadings, the trial court entered an order sustaining the first two preliminary objections, striking the Complaint for failing to state a legally sufficient cause of action, and deeming the remaining three preliminary objections moot. See Order, 11/13/24, at ¶¶ 1-4. This timely appeal followed.

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Fernandez raises the following issue 1 on appeal:

… [D]id the trial court err in concluding that the Bank’s post- repossession notice to Fernandez was sufficient as a matter of law under Article 9?

Appellant’s Brief, at 3-4.

Our standard of review is de novo when reviewing an order sustaining preliminary objections seeking dismissal of an action:

Our standard of review of an order of the trial court overruling or [sustaining] preliminary objections is to determine whether the trial court committed an error of law. When considering the appropriateness of a ruling on preliminary objections, the appellate court must apply the same standard as the trial court.

Preliminary objections in the nature of a demurrer test the legal sufficiency of the complaint. When considering preliminary objections, all material facts set forth in the challenged pleadings are admitted as true, as well as all inferences reasonably deducible therefrom. Preliminary objections which seek the dismissal of a cause of action should be sustained only in cases in which it is clear and free from doubt that the pleader will be unable to prove facts legally sufficient to establish the right to relief. If any doubt exists as to whether a demurrer should be sustained, it should be resolved in favor of overruling the preliminary objections.

____________________________________________ 1 In her Rule 1925(b) concise statement of matters complained of on appeal,

Fernandez raised a second issue challenging the trial court’s sustaining of the Bank’s second preliminary objection related to her claim that the Bank had a duty to provide her a post-sale notice pursuant to 13 Pa.C.S.A. § 9616(b)(1)(i). However, Fernandez has not raised or addressed this issue in her appellate brief. Accordingly, any such claim is waived. See Commonwealth v. Heggins, 809 A.2d 908, 912 n.2 (Pa. Super. 2002) (“an issue identified on appeal but not developed in the appellant's brief is abandoned and, therefore, waived.”); Pa.R.A.P. 2116(a). Moreover, as aptly addressed by the trial court in its opinion, the issue would not merit relief in any event. See Trial Court Opinion, 12/20/24, at 7.

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Fiedler v. Spencer, 231 A.3d 831, 835-36 (Pa. Super. 2020) (citations omitted). “This Court will reverse the trial court’s decision regarding preliminary objections only where there has been an error of law or abuse of discretion. When sustaining the preliminary objections will result in the denial of claim or a dismissal of suit, the preliminary objections may be sustained only where the case is free and clear of doubt.” Hill v. Ofalt, 85 A.3d 540, 547-48 (Pa. Super. 2014) (brackets and citation omitted).

After a thorough review of the record, the parties’ briefs, the applicable law, and the well-reasoned opinion of the Honorable Todd D. Eisenberg, we conclude Fernandez’s issue merits no relief. The trial court opinion comprehensively discusses and properly disposes of the question presented. 2

Accordingly, we affirm on the basis of the trial court’s opinion.

Order affirmed. ____________________________________________

2 We make only one observation to supplement the trial court’s thorough opinion. The only case cited by Fernandez dealing with an automobile post- repossession notice is Am. Gen. Fin. Servs, Inc. v. Woods-Witcher, 669 S.E.2d 709 (Ga. Ct. App. 2008). Fernandez’s reliance on this case is misplaced. “[I]t is well-settled that this Court is not bound by the decisions of … other states' courts ...” Eckman v. Erie Ins. Exch., 21 A.3d 1203, 1207 (Pa. Super. 2011) (citation omitted). “We recognize that we are not bound by these cases; however, we may use them for guidance to the degree we find them useful and not incompatible with Pennsylvania law.” Id. (citation and quotations marks omitted). We do not find Woods-Witcher useful as the facts are inapposite. There, the Georgia Court of Appeals addressed a post- repossession notice that was clearly insufficient with substantial deviations from the model statutory form provided under the Virginia UCC. See id. at 711. Here, as noted by the trial court, the post-repossession notice utilized by the Bank complied with the required safe harbor language from the Pennsylvania statute.

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Date: 6/5/2025

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01:05 PM Circulated 05/14/2025 01.05

c a• a• E O U

U 'a a m IN THE COURT OF COMMON PLEAS OF MONTGOMERY CO COUNTY, PENNSYLVANIA U ,O U m CIVIL DIVISION U y0 Q t

a .m KRISTY FERNANDEZ, individually individually : NO. 2024-18819 CO O and on behalf of all others similarly : o= = U situated !• O o= Q co V.

PEOPLE'S SECURITY BANK AND O to TRUST COMPANY U N r.b U

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0 CO m OPINION E o U •• L m N.

N N EISENBERG, J. December D December - r,2024 -Mp. %2024 Kristy Fernandez has appealed to the Superior Court of O U O Of 64 Pennsylvania from this court's Order dated November 13, 2024, sustaining U!a am Appellee's Preliminary Objections, and dismissing the case. We believe N • that this appeal is without merit. O

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Oa Background oQ o• ao This case was initiated via aaComplaint in Class Action filed on July •a O U

•cc 31, 2024. Upon stipulation by the parties, the response deadline was m m m a,U extended to September 13, 2024. 2024. (Stipulation, (Stipulation, August 14, 2024). oco

10 Defendant filed the Preliminary Objections that are the subject of the Y N U a O

co present appeal on September 13, 2024, along with aa corresponding brief. c co .m N a O• N •a m c mc U•

Plaintiff filed a aresponse brief in opposition to Defendant's Preliminary

Ubjections Objections on Uctober October 3, ', 2024. Upon review and consideration of the the

pleadings before the Court, this Court sustained Defendant's Preliminary Objections by Order dated November 13, 2024.

The Complaint asserts a a claim under the Uniform Commercial Code

following Defendant's repossession of Plaintiffs vehicle. The single Count

in the Complaint states that Defendant Defendant "violated "violated Pennsylvania's UCC by

failing to provide proper notice of disposition of collateral" and and "violated "violated

Pennsylvania's UCC by failing to provide proper notice of the calculation of

a a deficiency or surplus."

Defendant raised a a number of Preliminary Objections in the motion.

This Court granted the first two objections, thereby deeming the remaining objections moot.

Appellant filed the instant timely Notice of Direct Appeal on November 18, 2024, with the Superior Court of Pennsylvania. By order

dated dated November 21, 21, 2024, the undersigned directed Appellant to file a a

concise concise statement statement of of errors errors complained of on appeal, pursuant pursuant to

Pennsylvania Pennsylvania Rule Rule of Appellate Procedure 1925(b). On On November 26,

2024, 2024, the court received Appellant's 1925(b) statement. In her concise

statement statement Appellant Appellant asserts the the following:

2 *3 1. Defendant used the template form of safe harbor notice set forth

in the Uniform Commercial Code, 13 Pa. G.S.A Gode, I3 C.S.A 9614(3), 961.4(3), but but; failed

to properly complete the form in a amanner that would adequately

describe Plaintiff's Plaintiffs liability for a a deficiency, as Defendant did not

specify whether Plaintiff either either "will" "will" or or "will not" be liable for for a a

deficiency. In sustaining Defendant's First Preliminary Objection, did the Court err in concluding that Defendant's post-

repossession notice to Plaintiff was sufficient as a a matter of law

under 13 Pa. C.S.A 9614(1)(ii)?

2. The duty to send a a proper post- sale notice under the Uniform. post-sale

Commercial Code, 13 Pa. C.S.A 9616(b)(1)(i), 9616(b)(l)(i), arises arises "before "before or

when the secured party accounts to the debtor and pays any surplus[.]" This duty was triggered here when Defendant sent

Plaintiff the post- sale notice that included a post-sale a check with the

surplus sale proceeds. In sustaining Defendant's Second

Preliminary Objection, did the Court err in concluding that that

Defendant Defendant was not required to to send Plaintiff a a post- sale notice post-sale

under under 13 13 Pa. Pa. C.S.A 9616(b)(1)(i)? 96160b)(1)6)?

DISCUSSION

Appellant asserts in her first allegation of error by the Court, that

Appellee failed to provide proper pre- disposition notice, as required by 13 pre-disposition

Pa.C.S.A. 9614. More specifically, in her concise statement, Appellant

alleges that the deficient language did not specify whether Appellant. Appellant "will" "will"

or or "will "will not" owe the money in the event of aadeficiency. Appellant's

argument is without merit.

The specific language of the safe harbor provision of 13 Pa.C.S.A

9614 used by Appellee in the pre- disposition notice is as follows: pre-disposition follows: "{31 "{3} The

money that we get from the sale, after paying our costs, will reduce the

amount you owe. If we get less money than you owe, you you (will (will or will not,

as applicable) still owe us the difference. If we get more money than you

owe, you you will get the the extra money, unless we must pay it to someone else."

13 Pa.C.S.A 9614(a)(3). The language of the notice sent by Appellee and

received by Appellant states states "[i]f "[i]f we get less money than you owe, you you (will (will

or or will not, not, as as applicable) applicable) still owe us the difference." difference." (Defendant's (Defendant's

Preliminary Preliminary Objections, Exhibit B).

It It is is clear clear from from rules of statutory statutory construction that that "words "words and

phrases phrases shall shall be be construed construed according to the rules rules of grammar and

according according to to their their common and approved usage..." usage ... " 1 1 Pa.C.S.A., 1903(a).

Furthermore, Furthermore, "[t]he "[t]he object of all interpretation and construction of statutes

is Lo to asce-;rLain ascertain and effecLuaLe effectuate Lhe the iril,eriL.ioxi Lhe General intention of the

Assembly......[w]hen Assembly [w]hen the words of a a statute are clear and free from

ambiguity, the letter of it is not to be disregarded under the pretext of

pursuing its spirit." 1Pa.C.S.A. 1921(a)&(b). 1Pa.C.S.A. 1921(a)&0b). In constructing the Notice

(safe harbor) provision of 13 Pa.C.S.A 9614 the legislature chose to use the

phrase phrase "(will "(will or will not, as applicable)" regarding debt collector's potential

to collect less than the amount owed. The legislature did not choose to

separate the words words "will" "will" or or "will "will not" with parentheses as is often the case

when the directive is for the reader of the statute to choose one option or the other. Rather, the legislature chose to link the words as one phrase,

offering that the decision will be determined determined "as "as applicable" depending on

the outcome of the sale. Id. As indicated in Appellee's Brief accompanying the Preliminary Objections:

no one can describe with accuracy the Borrower's liability for a a deficiency deficiency because at the time the Post-Repossession/Pre-Sale Notice is is prepared prepared and and delivered to Borrower the private sale has yet to to occur occur and nono one can predict what aa future sale of collateral will yield; yield; that that is is why why the model language is worded in such a a fashion toto advise advise that that if if the Bank gets less money money than than is owed, the Borrower may owe the difference. This is exactly what Exhibit B B states..." states ... " (Brief (Brief in support of Preliminary Objections, p. 10).

As As such, such, Appellee's Appellee's Post- Repossession notice clearly complies with the Post-Repossession the

required required language language of of the the safe safe harbor harbor notice notice provision. provision.

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U 'a a m Appellant's next allegation of error asserts that the Court erred U ,O U CU when sustaining Appellee's second Preliminary Objection regarding the U y0 .Q , G O a .m Post- Sale notice sent to Appellant. This Court sustained the Preliminary Post-Sale o •

o = U = Objection as the post- sale notice, attached as Exhibit C post-sale C to Appellee's •o o= o_ m Preliminary Objections, complies with the statutory requirements. The

language of Appellant's concise statement states that Appellee did in fact O_ y

U N

• • U send a a post- sale notice, yet suggests that the Court erred in concluding post-sale `= a Q3 Q3 that Appellee was not required to send a a post- sale notice under 13 post-sale Q_ 0 CU

Pa.C.S.A 9616(b)(1)(i). 9616(b)(l)(i). It is therefore unclear what allegation of error U •• N .m

Appellant is asserting. 64 O U O

The language of 12 Pa.C.S.A 9616(b)(1)(i) 96160b)(1)() requires that: 11

•Z13a (b) Explanation of calculation: In a a consumer- goods transaction in consumer-goods aC13 N h N • which the debtor is entitled to a a surplus or a a consume obligor is • O V O

N U liable for a a deficiency under section 9615 9615 (relating (relating to application of o 'm proceeds of disposition; liability for deficiency and right to surplus), Q3 o •? i m the secured party shall comply with one of the following paragraphs: O Q O Q (1) Send an explanation to the debtor or consumer obligor, as o• ao applicable, applicable, after the disposition and: •a O U U a, •cc (i) (i) before or or when the secured party accounts to the m m m a,U debtor debtor and pays pays any surplus or first makes makes demand in a a o record record on the consumer obligor obligor after the the disposition for

Y N payment payment of the deficiency; and U a O •

(ii) within 14 days after receipt of a a request 0 00 .• N a O• N •a m 6 6 v mc 0•

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U ,O U Co Additionally, the stiihite statute def - les "(4XI)IRIlaho►ri" defines "explanation" ,As fi►llo►ww's. as follows: U O .Q , G O a .m [a] record which: which: ((1) 1) states the amount of the surplus or deficiency; (2) provides an explanation in accordance withwith (c) (c) of how the secured o • O U party calculated the surplus or deficiency; deficiency; (3) (3) states, if applicable !• O that future debits, credits, charges, including additional credit QLm m• service charges or hAeresL, interest, rebates and expense may affect; affect the amount of the surplus or deficiency; and and (4) (4) provides aatelephone number or mailing address from which additional information O_ y concerning the transaction is available." 13 PaCSA 9616 9616 (a). (a). U N

• • U Appellee sent a a Post- Sale letter in compliance with 13 Pa.C.S.A. Post-Sale `= a Q3 Q m QJ 9616(b)(1)(i) 9616(b)(1)() to Appellant, on July 3, 2024, indicating that the vehicle at Co E o U •• issue had been sold, along with a a check for the surplus amount owed to N .m

N N Appellant. In further compliance, Appellee followed the elements O U O Of 64 11 necessary necessary for an an "Explanation" "Explanation" including in the letter, the amount of the •Z13a aC13 proceeds, proceeds, the the amount that was needed to payoff of the loan, the N • O

N 0 repossession repossession fee, and any possible miscellaneous fees taken before o_ o 'm providing the final surplus amount. amount. (Defendant's (Defendant's Preliminary Objections, Q3 o •?

Exhibit Q. i m

Oa C). The The letter letter additionally indicates that a a cashier's check in the oQ o• ao monetary monetary amount amount indicated was included, and concludes with a a phone •a O U U a, •cc number number should should Appellant Appellant have any additional questions. questions. Id. All of the m m m necessary necessary required required elements appear in in the the letter received by Appellant, o

along along with with a a check check in in the amount of of $$3,527,52. 3,527,52. Furthermore, it it would have Y N U a O •

• • N C6 O 00 ,f0

N a O N •a m 7 7 6 mc U•

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U 'a a m been been impossible impossible for for Appellee Appellee to to comply comply with with the the deficiency deficiency requirements requirements of of U ,O U m 13 13 Ya.L.S.A. Pa.t.S.A. 0010, 9016, as as there there was was nuL not a a deficiency deficiency following following Lhe the sale. sale. U y0 .Q , G O a .m

o •

o = U = CONCLUSION CONCLUSION •o o= o_ m For For all all of of the the foregoing foregoing reasons, reasons, we we believe believe that that this this court's court's order order of of

November November 13, 13, 2024, 2024, should should be be upheld. upheld. O_ y

U N

• • U

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m BY BY THE THE COURT: COURT:

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N N

64 O U O TODD TODD D. D. EISENBERG, EISENBERG, J. J. 11

•Z13a aC13 Copies of the above Order provided provided to to the the following following on on N Court Administration Administration (interoffice (interoffice mail) mail) • O

Cary Flitter, Esquire N 0 o_ Jody Thomas Lopez-Jacobs, Esquire Esquire o 'm Joseph L. Daniels, Esquire Esquire Prothonotary Prothonotary (interoffice (interoffice mail) Q3 o •? i m 1ej N O Q O Q t Q,

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