Pennsylvania Supreme Court Holds State Foreclosure Notice Requirements Do Not Impose Jurisdictional Prerequisites on Foreclosure Actions

Foreclosure Mortgage Servicing

On September 25, the Pennsylvania Supreme Court held that Pennsylvania state courts have jurisdiction over foreclosure actions where the foreclosing party may have failed to fully comply with the Pennsylvania Emergency Mortgage Act (Act 91) in providing notice of foreclosure. Beneficial Consumer Discount Co. v. Vukman, No. 29-WAP-2012, 2013 WL 5354330 (Pa. Sept. 25, 2013). A state trial court and intermediate appellate court set aside a judgment in a foreclosure action and subsequent sheriff’s sale, holding that the foreclosing party’s failure to comply with the Act 91’s foreclosure notice requirement stripped the state courts’ of subject matter jurisdiction. The Supreme Court disagreed and held that the pre-foreclosure requirements do not implicate the jurisdiction of the court—the borrower’s failure to pay the mortgage provided sufficient cause to pursue foreclosure. The court remanded the case to the trial court without addressing the foreclosing party’s arguments that its notice was sufficient because it was drafted by the state housing authority.