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MELLON BANK v. AUBREY K. LEE (07/07/89)

decided: July 7, 1989.

MELLON BANK, N.A.,
v.
AUBREY K. LEE, JR., AND JOYCE F. LEE, HIS WIFE, AND THE UNITED STATES OF AMERICA. APPEAL OF AUBREY K. LEE, JR., AND JOYCE F. LEE, HIS WIFE



Appeal from the Judgment entered September 6, 1988 in the Court of Common Pleas of Allegheny County, Civil Division, at No. GD 87-8628.

COUNSEL

Daniel L. Sautel, Pittsburgh, for appellant.

Arthur M. Lebovitz, Pittsburgh, Mellon Bank, appellee.

Wieand, Del Sole and Melinson, JJ.

Author: Del Sole

[ 385 Pa. Super. Page 390]

Aubrey K. and Joyce F. Lee, Appellants, appeal from the order of the trial court which granted the Motion for Summary Judgment of Mellon Bank, Appellee. The Lees raise one issue on appeal. We find that issue to be meritless and affirm the judgment of the trial court.

Mellon Bank loaned the Lees $100,000 on January 29, 1980. The loan was secured by a mortgage on the Lees' house. In April of 1983, the Lees became delinquent in their payments. On May 20, 1985, Mellon requested foreclosure

[ 385 Pa. Super. Page 391]

    on the mortgage. On May 22, 1985, letters were mailed to each of the Lees as required by the Homeowners Emergency Assistance Act, 35 P.S. § 1680.401c. On May 2, 1985, unbeknownst to Mellon, the Lees filed a voluntary Chapter 11 Bankruptcy Petition. The filing of such a petition acted as an Automatic Stay against the commencement or continuation of any administrative, judicial or any other action or proceeding against the debtor. (11 U.S.C. § 362(a)). Mellon received notice of the filing on June 25, 1985. After that, all efforts to foreclose on the Lees ceased.

The Lees failed to file a Plan while under the jurisdiction of the Bankruptcy Court to cure the mortgage arrearages. Mellon filed a Motion for Relief from the Stay which was granted on March 24, 1987. On May 20, 1987, Mellon filed a Complaint for mortgage foreclosure. Mellon then filed the Motion for summary judgment which was granted and which is the basis of this appeal.

The issue raised by the Lees in this appeal is whether the May 22, 1985 letters mailed by Mellon in accordance with the Homeowners Emergency Assistance Act violated 11 U.S.C. § 362. The Lees argue that Mellon's May 22, 1985 letters fell into the category of being the commencement or continuation of an administrative or judicial proceeding or action against the Lees. Therefore, according to the Lees, the May 22, 1985 letters were a nullity and when Mellon was granted relief from the Stay it should have mailed new letters to the Lees.

The Homeowners Emergency Assistance Act, 35 P.S. § 1680.401c et seq., was established to provide "a program which will, through emergency mortgage assistance payments, prevent widespread mortgage foreclosures and distress sales of homes which result from default caused by circumstances beyond a homeowner's control." (35 P.S. § 1680.401c, see footnote (b) Purpose). Before any mortgagee, such ...


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