J-A08029-16


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

NATIONSTAR MORTGAGE, LLC, D/B/A                IN THE SUPERIOR COURT OF
CHAMPION MORTGAGE COMPANY                            PENNSYLVANIA

                   v.

LEE AUDREY WILLIAMS AND GEORGE E.
WILLIAMS

APPEAL OF: LEE AUDREY WILLIAMS
                                                    No. 1742 EDA 2015


              Appeal from the Judgment Entered May 4, 2015
           In the Court of Common Pleas of Philadelphia County
             Civil Division at No(s): July Term, 2013 No. 4566


BEFORE: BOWES, OLSON and STRASSBURGER,* JJ.

MEMORANDUM BY OLSON, J.:                      FILED SEPTEMBER 12, 2016

     Appellant, Lee Audrey Williams, appeals from the judgment entered on

May 4, 2015 in the amount of $121,696.33 in favor of Nationstar Mortgage,

LLC, d/b/a Champion Mortgage Company (Nationstar) in a reverse mortgage

foreclosure action. Upon review, we affirm.

     The trial court summarized the facts of this case as follows:

        Ida J. Williams [(Mother)], now deceased, was the holder of
        a life estate in real property located at 5918 Larchwood
        Avenue,      Philadelphia,   Pennsylvania     (“[p]roperty”).
        [Mother’s] son, George Williams, and her daughter,
        [Appellant], held remainder interests in the [p]roperty. On
        September 17, 2008, [Mother] appointed [Appellant] her
        attorney-in-fact under a durable power of attorney [POA].
        On February 19, 2010, [Appellant], executing her authority
        under the [POA], and on behalf [Mother], executed a
        [h]ome [e]quity [c]onversion [m]ortgage, commonly
        referred to as a reverse mortgage. At the time, [Appellant]
        was sixty years old and did not qualify for a reverse
        mortgage as they are available only to homeowners aged

*Retired Senior Judge assigned to the Superior Court.
J-A08029-16


       sixty-two and above. [12 U.S.C.A. § 1715z-20(a) and (b)
       (defining eligibility requirements for participation in reverse
       mortgage market as “any homeowner who is, or whose
       spouse is, at least 62 years of age or such higher age as the
       Secretary [of Housing and Urban Development (HUD)] may
       prescribe”); 24 C.F.R. § 206.33.]

       Reverse mortgages are administered by [HUD] and are
       insured by Section 255 of the National Housing Act. In a
       reverse mortgage, loan proceeds are paid out in accordance
       with a payment plan selected by the [b]orrower. If the
       lender becomes unable to make payments to the
       [b]orrower, the Secretary [of HUD] assumes responsibility
       for making the payments. The mortgage proceeds paid by
       the lender and/or HUD are secured by direct and second
       mortgages on the property. The obligation to satisfy the
       loan secured by the mortgages is deferred until the death of
       the [b]orrower, the sale of the home, or the occurrence of
       other events specified in regulations of the [HUD]
       Secretary. After certain qualifying events have occurred,
       the reverse mortgage is paid in a single payment.

       Here, the reverse mortgage executed on February 19, 2010
       was between [Mother] (Borrower) and Bank of America,
       N.A. (Lender) and the Secretary of [HUD]. On the same
       date, in connection with the reverse mortgage, [Appellant],
       exercising her authority under the [POA], and on behalf of
       [Mother], signed a mortgage and note to Bank of America,
       N.A. (“Bank of America”).      The mortgage secured the
       repayment of the debt evidenced by the note, including all
       future advances, with interest at a rate subject to
       adjustment, and all renewals, extension and modifications
       of the note, up to a maximum principal amount of
       $165,000.00.     The mortgage to Bank of America was
       recorded on November 25, 2013[.] On the same date, in
       connection with the reverse mortgage, [Appellant],
       exercising authority under the [POA], and on behalf of
       [Mother], signed a second mortgage and note with the
       Secretary of [HUD], as required by Section 255(i)(1)(A) of
       the National Housing Act to secure payments which the
       Secretary may make to or on behalf of the [b]orrower. The
       mortgage to the Secretary of [HUD] was recorded on March
       9, 2010[.]


                                    -2-
J-A08029-16


       The full debt under the reverse mortgage, if not paid earlier,
       was due and payable on December 14, 2064. However,
       paragraph nine (9) of the mortgage to Bank of America
       provided, in relevant part, the following grounds for
       acceleration of [the] debt:

          (a)        Due and Payable.        Lender may require
                     immediate payment in full of all sums secured
                     by the Security Instrument if:

              (i)         A Borrower dies and the [p]roperty is
                          not the principal residence of at least
                          one surviving Borrower; or

              (ii)        All of a Borrower’s title in the
                          [p]roperty (or his or her beneficial
                          interest in trust owning all or part of
                          the [p]roperty) is sold or otherwise
                          transferred and no other Borrower
                          retains (a) title to the [p]roperty in fee
                          simple, (b) leasehold under a lease for
                          less than 99 years which is renewable
                          or a lease having a remaining period of
                          not less than 50 years beyond the date
                          of the 100th birthday of the youngest
                          Borrower, or a life estate in the
                          [p]roperty (or a beneficial interest in
                          trust with such interest in the
                          [p]roperty).

       On December 28, 2010, [Mother] died. On November 21,
       2012, a [m]ortgage [d]ue [and] [p]ayable [n]otification was
       sent to the [p]roperty advising that because of the death of
       [Mother], the reverse mortgage debt in the amount of
       $100,429.35 was due and payable within thirty (30) days of
       the date of the letter. On June 24, 2013, the mortgage to
       Bank of America was assigned to Nationstar [] by written
       permission. It was recorded on November 25, 2013[.]

       On June 27, 2013, a [n]otice of [i]ntention to [f]oreclose
       [m]ortgage pursuant to Act 6 of 1974, 41 P.S. § 403m was
       sent to the [p]roperty by certified and first class mail
       notifying [Appellant] and George Williams of the default
       under the terms of the reverse mortgage, and the amount

                                       -3-
J-A08029-16


        to pay off the mortgage. On March 19, 2014, the mortgage
        to Nationstar was assigned back to Bank of America by a
        written assignment. It was recorded on April 14, 2014[.]
        Neither [Appellant] nor George William paid off the debt,
        nor did they attempt to sell the [p]roperty for 95% of its
        appraised value as permitted under HUD to satisfy the debt.
        On August 1, 2013, Nationstar filed a [c]omplaint in
        [m]ortgage [f]oreclosure against [Appellant] and George
        Williams. A non-jury trial was held on May 4, 2015. At the
        conclusion of the trial, [the trial court] entered judgment in
        favor of Nationstar in the amount of $121,696.33,
        foreclosing on [Appellant’s] and George Williams’s interest
        in the [p]roperty.

        On May 14, 2015, [Appellant] filed a [p]ost-[t]rial
        [m]otion[.]     [The trial court] denied the [p]ost-[t]rial
        [m]otion on May 29, 2015. On June 1, 2015, [Appellant]
        filed an appeal from the [] May 29, 2015 [o]rder. Pursuant
        to [the trial court’s] directive, [Appellant] filed her [c]oncise
        [s]tatement of [e]rrors [c]omplained of on [a]ppeal on June
        16, 2015. [The trial court issued an opinion pursuant to
        Pa.R.A.P. 1925(a) on September 14, 2015.]

Trial Court Opinion, 9/14/2015, at 2-6 (bullet point format and record

citations omitted).

      On appeal, Appellant presents the following issues for our review:

        1. Did the trial court commit an error of law by determining
           [Nationstar] was entitled to declare the reverse
           mortgage loan due and payable upon the death of
           [Appellant’s] mother pursuant to paragraph 9(a) of the
           mortgage, when the property remained the principal
           residence of [Appellant]?

        2. Did the trial court commit an error of law by determining
           that [Appellant] was not a “Borrower” within the
           meaning of the mortgage instrument, and determining
           that therefore, upon the death of [Appellant’s] mother,
           the property did not remain the principal residence of a
           surviving borrower?




                                      -4-
J-A08029-16


        3. Did the trial court commit an error of law by looking
           beyond the mortgage instrument itself to construe the
           meaning of the term “Borrower” in the mortgage
           instrument?

        4. Did the trial court commit an error of law and abuse its
           discretion    by   sustaining hearsay     objections  to
           [Appellant’s] testimony that prevented her from
           establishing the basis for her equitable defense to
           foreclosure?

Appellant’s Brief at 3-4 (suggested answers omitted).

      We will examine Appellant’s first three claims as presented in a single

discussion as all of those issues center on the contention that the trial court

erred by determining Nationstar was entitled to declare the reverse

mortgage at issue due and payable upon Mother’s death.        Appellant avers

that she was a surviving borrower and the property remained her primary

residence under the plain, contractual terms of the reverse mortgage. Id. at

13-14. Appellant avers the trial court erroneously determined that Appellant

was not a borrower despite her designation as such in the first paragraph of

the mortgage instrument. Id. at 16. She claims the “mortgage contained

separate signature lines with the three borrowers’ [(Mother’s, Appellant’s,

and George Williams’)] names pre-printed below.” Id. at 18. For support,

Appellant relies on a Florida appellate decision, Smith v. Reverse

Mortgage Solutions, Inc., 2015 WL 4257632 (Fla. App. 3 Dist. 2015). Id.

at 19-20.

      Appellant criticizes the trial court’s search beyond the definition of

borrower set forth in the mortgage, including the court’s examination of

                                     -5-
J-A08029-16


other transaction documents. Appellant claims she was not a party to these

instruments and, thus, it was improper to infer the contract’s meaning from

them.     Id. at 17-18, 21.   Appellant also points out that some documents

name only Mother as a borrower, while other documents name all three

family members as borrowers.        As such, the trial court was required to

construe these ambiguities against Nationstar as the drafter of the contract.

Id. at 30.        Appellant argues, “[t]he fact that [Mother] was the only

‘borrower’ on the promissory note, i.e. the only person personally liable for

payment, did not mean that she was the only ‘borrower’ on the mortgage.”

Id. at 23.    Appellant further claims that Mother had no duty to preserve the

property for her children and, therefore, “[Nationstar] could have taken a

mortgage from [Mother] alone without including the remainderpersons as

parties thereto, without effecting the mortgage [and the] fact that

[Appellant] was named as a borrower, when she did not have to be so

named, confirms that the parties intended her to be so named[.]” Id. at

25 (emphasis in original).    Likewise, Appellant argues Nationstar was not

obligated under federal regulations to name Appellant as a borrower under

the mortgage, but it did so anyway. Id. at 27-28. Thus, in sum, Appellant

maintains the conditions precedent had not been met for Nationstar’s

foreclosure action. Id. at 15-16.

        Initially, we note:

          Reverse mortgages have been described as a financial
          planning device for the elderly who are often house rich, but

                                      -6-
J-A08029-16


        cash poor. A reverse mortgage can address this dilemma by
        providing a means for converting home equity into cash. In
        a reverse mortgage, as in a conventional mortgage, the
        mortgagee or lender advances money to the borrower or
        mortgagor. However, in a reverse mortgage the borrower is
        often times not obligated to repay any portion of the loan or
        the interest on the loan amount until the property is sold,
        the loan matures or the borrower dies or experiences an
        extended absence from the premises. The interest on the
        borrowed sums is added to the principal loan amount and
        the lender acquires a lien against the house in the amount
        of the initial principal and accumulated interest.

In re Estate of Moore, 871 A.2d 196, 201 n.3 (Pa. Super. 2005) (internal

quotations and citations omitted).

     A reverse mortgage is a contract.      Since contract interpretation is a

question of law, “our review of the trial court's decision is de novo and our

scope is plenary.” Bair v. Manor Care of Elizabethtown, PA, LLC, 108

A.3d 94, 96 (Pa. Super. 2015). We previously determined:

        The fundamental rule in interpreting the meaning of a
        contract is to ascertain and give effect to the intent of the
        contracting parties. The intent of the parties to a written
        agreement is to be regarded as being embodied in the
        writing itself. The whole instrument must be taken together
        in arriving at contractual intent. Courts do not assume that
        a contract's language was chosen carelessly, nor do they
        assume that the parties were ignorant of the meaning of the
        language they employed. When a writing is clear and
        unequivocal, its meaning must be determined by its
        contents alone.

        Only where a contract's language is ambiguous may
        extrinsic or parol evidence be considered to determine the
        intent of the parties. A contract contains an ambiguity if it is
        reasonably susceptible of different constructions and
        capable of being understood in more than one sense. This
        question, however, is not resolved in a vacuum. Instead,
        contractual terms are ambiguous if they are subject to more

                                     -7-
J-A08029-16


        than one reasonable interpretation when applied to a
        particular set of facts. In the absence of an ambiguity, the
        plain meaning of the agreement will be enforced. The
        meaning of an unambiguous written instrument presents a
        question of law for resolution by the court.

Ramalingam v. Keller Williams Realty Group, Inc., 121 A.3d 1034,

1046 (Pa. Super. 2015) (citation and original emphasis omitted).

      Here, the first paragraph of the reverse mortgage states:

        The mortgagor is [Mother], as to the Life Estate interest and
        [Appellant] and George E. Williams as to the remainder,
        whose address is 5918 Larchwood Avenue, Philadelphia,
        Pennsylvania, 19143 (“Borrower”).

Reverse Mortgage, 2/19/2010, at 1.         While Appellant argues that this

language shows that she was a borrower under the mortgage, we note that

the mortgage uses the singular term “borrower” rather than the plural form

of that word.      In addition, at the end of the document, just above the

signature lines, the mortgage reads, “BY SIGNING BELOW, Borrower accepts

and agrees to the terms and covenants contained in this Security

Instrument[.]” Id. at 8. Again, the mortgage employs the term “borrower”

in the singular.    There is also a stand-alone signatory line, with Mother’s

name and Appellant listed as POA pre-printed below it. Id.        Appellant, as

POA, signed for Mother on this first signatory line. Id. Directly below the

first signature are two additional signatory lines.   Underneath those lines,

Appellant’s and George Williams’ typewritten names appear and both are

designated “REMAINDERMAN.” Id. Both parties signed the agreement and

handwrote “Remainderman” after their signatures.        Id.   Thus, while the

                                     -8-
J-A08029-16


document does not explicitly define the term “borrower,” the reverse

mortgage instrument refers only to a single borrower.

      Further,   we   reject   Appellant’s   reliance   on   Smith   v.   Reverse

Mortgage Solutions, Inc., 2015 WL 4257632 (Fla. App. 3 Dist. 2015).

Initially, we note that while the pronouncements of courts in sister states

may be persuasive authority, those pronouncements are not binding on

Pennsylvania appellate courts. See Umbelina v. Adams, 34 A.3d 151, 160

n.3 (Pa. Super. 2011). Further, the facts of Smith are markedly different

from this matter.     Smith dealt with a reverse mortgage taken out by

husband and wife borrowers. The reverse mortgage “identifi[ed] Mr. Smith

as ‘a married man’ and the mortgagor, [and] thereafter refer[red] to [him]

as the “Borrower.”     Smith, 2015 WL 4257632, at *3.            However, both

spouses signed the mortgage. The Florida Court’s decision was based, inter

alia, upon the fact that Mr. Smith was specifically delineated in the mortgage

as “a married man” and “Florida’s Constitution[al] require[ment that] Mrs.

Smith [sign] the mortgage to effectuate the lender's security interest in [the

couple’s] homestead property […] since Mr. Smith was married to Mrs.

Smith at the time the mortgage was executed [and] only a deed containing

Mrs. Smith's signature could validly convey her interest in the property.” Id.

at *4.   Additionally, examining federal reverse mortgage law, the Smith

Court recognized “Congress's clear intent to protect from foreclosure a

reverse mortgagor's surviving spouse who is maintaining the encumbered


                                      -9-
J-A08029-16


property as his or her principal residence.”   Id. at *5.   Here, unlike Mrs.

Smith, Appellant was not a necessary party to the mortgage. Appellant was

not a surviving spouse and had only a remainder interest in the subject

property. Under the intra-family transfer instrument through which Mother

acquired her life estate interest in the property, Mother enjoyed the right to

encumber the property freely and without the consent of George Williams or

Appellant. See Intra-Family Transfer Agreement, 2/19/10, at 1 (“Grantors

do hereby grant and convey unto [Mother], for her life, a life estate with

full powers of disposition and authority during her life to sell,

convey, mortgage and otherwise dispose the entire estate in the

[p]roperty (except by Last Will and Testament) without the consent

or joinder of any remainderman, and to retain absolutely as her own,

all of the proceeds thereof, thereby divesting the remainder granted

by the Indenture, without liability for waste”) (emphasis added).

      We also are not troubled by the trial court’s examination of documents

other than the mortgage agreement. As this Court previously determined,

“[w]here several instruments are made as part of one transaction they will

be read together, and each will be construed with reference to the other;

and this is so although the instruments may have been executed at different

times and do not in terms refer to each other.” Huegel v. Mifflin Const.

Co., Inc., 796 A.2d 350, 354-355 (Pa. Super. 2002) (citation omitted).

Upon review of the certified record, most of the supporting documentation,


                                    - 10 -
J-A08029-16


including the loan application, two promissory notes, HUD documents, a

home equity agreement, and a certificate of reverse mortgage counseling

identify only Mother as a borrower. On these documents, Appellant signed

in her official capacity as POA for Mother, but did not sign these documents

in her own right as a borrower.

      We find, however, most compelling the ownership interest certificate,

which stated as follows:

        If you have an ownership interest in the [] property but will
        not be a borrower under the proposed reverse mortgage,
        you need to be aware of the following:

                           *         *           *

        If you continue to reside in the property after divestiture
        and the borrower predeceases you [], the reverse mortgage
        will become due and payable.

Ownership Interest Certificate, 12/22/2009, at 1. As POA, Appellant signed

for Mother on a signatory line specifically designated as “Borrower.”

Appellant also signed the certificate in her own capacity, on a signatory line

specifically designated as “Non-Borrowing Resident.”         Thus, Appellant

explicitly acknowledged that she was a non-borrowing resident.

      Based upon all of the foregoing, including construing all of the written

instruments that are part of this one transaction, we conclude the trial court




                                    - 11 -
J-A08029-16


did not err in determining Mother was the sole borrower under the reverse

mortgage.1 Hence, Appellant’s first three issues lack merit.

       Finally, in her fourth issue presented on appeal, Appellant argues the

trial court committed an error of law and abused its discretion by sustaining

Nationstar’s hearsay objections to Appellant’s testimony regarding an

alleged equitable estoppel defense to foreclosure.        Appellant claims that

Nationstar “or its agents promised her, at the time of the loan origination,

that she would not lose her home upon the death of her mother, and that

[Nationstar] could not later foreclose in violation of that promise.”

Appellant’s Brief at 31.       She claims the trial court erred by excluding her

testimony as hearsay and not subject to the admission of a party opponent

exception to hearsay.2 Id. Appellant further argues the trial court erred in

concluding that she did not present evidence that the declarant was
____________________________________________


1
  We find further support in our interpretation from the federal regulations.
In order to qualify for a reverse mortgage, “[t]he youngest mortgagor shall
be 62 years of age or older at the time[.]” 24 C.F.R. § 206.33. Appellant
was 59 years old at the time the mortgage. N.T., 5/4/2015, at 78.
Appellant testified that she was aware that neither she nor her brother
qualified for a reverse mortgage at the time of its origination. Id.
2
   At the foreclosure hearing, Appellant also argued that her testimony
qualified under the state of mind exception to hearsay. N.T., 5/4/2015, at
68. However, in her brief to this Court, Appellant does not set forth any
argument or relevant law pertaining to the state of mind exception. Thus,
she has waived her prior contention. See Commonwealth v. Johnson,
985 A.2d 915, 924 (Pa. 2009) (“[W]here an appellate brief fails to provide
any discussion of a claim with citation to relevant authority or fails to
develop the issue in any other meaningful fashion capable of review, that
claim is waived.”).



                                          - 12 -
J-A08029-16


Nationstar’s agent or had authority to make promises to Appellant because,

at trial, the trial court took judicial notice that there were representatives

“from the mortgage company and from the lender” at the closing. Id. at 33.

      We review a trial court's decision regarding the admission of evidence

under the following standard:

         It is well established in this Commonwealth that the
         decision to admit or to exclude evidence [] lies within the
         sound discretion of the trial court. Moreover, our standard
         of review is very narrow; we may only reverse upon a
         showing that the trial court clearly abused its discretion or
         committed an error of law. To constitute reversible error, an
         evidentiary ruling must not only be erroneous, but also
         harmful or prejudicial to the complaining party.

Harris v. Toys "R" Us-Penn, Inc., 880 A.2d 1270, 1274 (Pa. Super.

2005).

      The Pennsylvania Rules of Evidence define hearsay as “a statement,

other than one made by the declarant while testifying at the trial or hearing,

offered in evidence to prove the truth of the matter asserted.” Pa.R.E.

801(c). The rules further provide that “[h]earsay is not admissible except as

provided by these rules, by other rules prescribed by the Pennsylvania

Supreme Court, or by statute.” Pa.R.E. 802.       The statement at issue is

hearsay, as it was made out of court and was offered by Appellant to prove

the truth of the matter asserted, i.e., that the subject property would not be

foreclosed upon in the event of Mother’s death. It is therefore inadmissible

unless an exception to the hearsay rule applies. See Pa.R.E. 802.




                                    - 13 -
J-A08029-16


     Rule 803(25) creates an exception to the hearsay rule for admissions

by party-opponents and states, in pertinent part:

        (25) An Opposing Party's Statement. The statement is
        offered against an opposing party and:

           (A)     was made by the party in an individual or
                   representative capacity;

           (B)     is one the party manifested that it adopted or
                   believed to be true;

           (C)     was made by a person whom the party
                   authorized to make a statement on the
                   subject;

           (D)     was made by the party's agent or employee on
                   a matter within the scope of that relationship
                   and while it existed[.]

Pa.R.E. 803(25).

     “The proponent of an admission by a party-opponent under Rule

803(25)(D) must establish that the declarant was an employee of the

principal at the time the statement was made, and the statement concerned

a matter within the scope of employment.”         Harris, 880 A.2d at 1277

(citation omitted). Moreover,

        It is the responsibility of the judge [] to resolve preliminary
        factual questions which form a basis for the legal
        admissibility of evidence.       These preliminary questions
        include whether evidence qualifies under an exception to
        the hearsay rule. In considering the admissibility of
        evidence, a trial court may properly consider credibility.
        Appellant, as proponent of the statement, bears the burden
        of proof and must convince the court that the hearsay
        statement is admissible as an admission of a party
        opponent.


                                    - 14 -
J-A08029-16


                              *         *            *

          Without this safeguard, parties could present to the jury any
          statements that they assert are admissions by their
          opponents, effectively gutting the hearsay rule.

Id. at 1278 (internal citations and quotations omitted).         Bald statements

that a declarant was an agent will not suffice.          Id. at 1277 (“Beyond an

approximate height and a characterization of the speaker as thin, Appellant

provided no information about the declarant.”).

        On this issue, the trial court determined:

          Not only was [Appellant’s] trial testimony vague, it was
          unaccompanied by any supporting evidence. The broker
          who allegedly made these promises was not called to testify
          at trial. In fact, [Appellant] did not provide [the trial court]
          with any other evidence to corroborate her claim either by
          other testimony from other witnesses, or written
          documents.

Trial Court Opinion, 9/14/2015, at 16.

        Upon review, we discern no abuse of discretion in excluding the

proffered testimony as hearsay, not subject to exception.         Appellant could

not identify the declarant with specificity.         She testified “a Caucasian

gentlemen” came to the subject property to discuss generally the reverse

mortgage process, but Appellant did not “remember anything else about

him.”    N.T., 5/4/2015, at 67.     Later, Appellant testified that at the loan

closing, she and her brother were there with “the loan people.” Id. at 69.

The trial court determined that Appellant’s testimony was not credible,

describing it as vague and without support.          Without a description of the


                                      - 15 -
J-A08029-16


individual(s) who allegedly made representations, Appellant could not

establish an agency relationship. Finally, while the trial court took “judicial

notice that [] at the closing, there [were] representatives there from the

mortgage company and the lender[,]” it did not take judicial notice that

those representatives were authorized to make the alleged statements or

that the statements were made within the scope of that relationship. N.T.,

5/4/2015, at 74. Thus, Appellant simply did not meet her burden of proof

under Rule 803(25).       Accordingly, we discern no abuse of discretion in

excluding the proffered testimony and Appellant’s final issue fails.

      Judgment affirmed.

      Judge Bowes joins this Memorandum.

      Judge Strassburger files a Dissenting Memorandum.


Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 9/12/2016




                                     - 16 -
J-A08029-16




              - 17 -
