NO. 3333 Philadelphia, 1982, Appeal from the Order entered November 17, 1982, in the Court of Common Pleas of Philadelphia County, Civil, at No. 4456 August Term, 1976.
Stephen A. Sheller, Philadelphia, for appellant.
Marc S. Weisberg, Philadelphia, for appellee.
Spaeth, President Judge, and Brosky and McEwen, JJ.
[ 334 Pa. Super. Page 391]
Public Federal Savings & Loan Association has appealed from the judgment entered in favor of appellee following dismissal of appellant's exceptions to the decision of the trial judge in this mortgage foreclosure action. We reverse.
The parties submitted the case to the trial court on the basis of the following stipulated facts: Stephen Zeitz and Joyce M. Zeitz were the owners of the pertinent real estate located at 11106 Hendrix Street, in Philadelphia, Pennsylvania. On October 7, 1975, the Zeitzes executed and delivered a mortgage on the premises to appellant Public Federal Savings & Loan in the amount of $36,000 as security for a loan advanced to them by Public Federal. This mortgage was recorded the following day. On October 30, 1975, the Zeitzes executed a judgment note in favor of Provident Consumer Discount Company in the amount of $1,470.00. When the Zeitzes defaulted on the latter loan, Provident Consumer obtained a judgment against them and initiated execution proceedings against the Hendrix street property with the proviso that the property be sold by the sheriff subject to the mortgage in favor of Public Federal. Handbills containing notice of the sale and of the condition that the property was to be sold "subject to mortgage" were posted at the office of the sheriff and upon the property, as required by Pennsylvania Rule of Civil Procedure 3129(b)(1). Advertisements for the sheriff's sale, which appeared on three separate dates in the Legal Intelligencer, also contained the statement that the property was to be sold subject to the mortgage. The successful bidder at the sheriff's sale of July 12, 1976, offered $18,200 for the property. The successful bidder subsequently assigned his bid to the appellee and the sheriff thereafter conveyed the property to the appellee.
[ 334 Pa. Super. Page 392]
However, at the time of the sale by the sheriff, there existed two other judgments of record against the Zeitzes, both of which were prior in date to the mortgage in favor of appellant and both of which, although they had been paid in full, appeared as unsatisfied of record:
A judgment in the amount of $690.95 in favor of Diner's Club, Inc., dated May 9, 1974, which had been paid on or about February 24, 1975, but was not marked satisfied of record until September 15, 1976.
A judgment in the amount of $600.55 in favor of Kacher, Schnall & Herman, P.C., dated July 28, 1975, which had been paid on or about October 7, 1975, but was not marked satisfied of record until September 20, 1976.
Appellee has refused to meet the obligations of the mortgage as a result of his contention that the two judgments which appeared of record as outstanding at the time of the sheriff's sale discharged the mortgage of appellant as a matter of law.
It is well established in Pennsylvania that a sheriff's sale of real property discharges all liens which are not satisfied of record at the time of sale. See Liss v. Medary Homes, Inc., 388 Pa. 139, 130 A.2d 137 (1957); Girard Life Insurance Co. v. Farmers' and Mechanics' National Bank, 57 Pa. 388 (1868); Silverman v. Keal, 135 Pa. Super. 568, 7 A.2d 57 (1939). The legislature has provided, however, that, as a general rule, the sale of real property pursuant to a writ of execution does not affect the ...