On January 30, 2012, the Superior Court of Pennsylvania decided the Vukman case (Beneficial Consumer Discount Company v. Vukmam, 2012 WL 258674 (Pa.Super.), in which it held that Act 91 Notices sent after June 5, 1999 and prior to September 8, 2008 were defective. This decision wreaked havoc on real estate foreclosures by basically creating an avenue to challenge foreclosures that occurred prior to September 8, 2008. In response, numerous real estate groups such as the Pennsylvania Association of Realtors and the Pennsylvania Land Title Association began lobbying efforts to resolve a situation that put a halt to the sale of any properties that were foreclosed on prior to September 2008.
On June 22, 2012, the Govenor signed into law Senate Bill 1433 which, is now known as Act 70 of 2012 (“Act 70”), effective immediately. Act 70 alleviates any concerns regarding these real estate sales. Act 70, establishes certain criteria for challenging these foreclosures, retroactive to June 5, 1999, the day the Act 91 notice form was amended.
The Act provides that a court may dismiss a foreclosure action, and impose other appropriate remedies, only if the mortgagee failed to comply with Act 91 notice requirements and the mortgagor properly raises such non-compliance in the foreclosure action and proves prejudice, that the failure of a mortgagee to comply with Act 91 notice requirements must be raised in a foreclosure action prior to the delivery of the Sheriff’s deed and the failure of a mortgagee to comply with Act 91 notice requirements does not deprive a court of jurisdiction over a foreclosure action.
The Pennsylvania Legislature should be commended for taking such quick action to resolve a matter that could have held up sales for certain properties as well as affected many properties that were sold over the last several years.