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Marshall v. Sostaric

Marshall v. Sostaric

Case No. 
14-0143
Type of Proceeding: 
Appeal from the Circuit Court of Morgan County (Judge Lorensen)
Issues: 

In this pro se case, there are both procedural and substantive issues.  First, the Supreme Court will have to decide if summary judgment procedures were properly applied in light of the fact that both parties appeared pro se.  Second, there are substantive issues involving a trustee’s sale--i.e., whether the sale generated a fair value for the property.

Background: 

In a very unusual twist, both parties to this appeal have made pro se appearances.  It is difficult to discern exactly what the facts are and exactly what issues are being raised.  However, the case has been placed on the Rule 20 docket, meaning that the Supreme Court anticipates it will be deciding a new point of law.

Stjepan Sostaric and his then wife, Nancy, borrowed $200,000 from Sally Marshall, signed a promissory note and gave a security interest in property they owned in Berkeley Springs, West Virginia.  Because the Sostarics fell behind in their payments, Marshall accelerated the note.  Eventually, the property was offered for sale at a trustee’s sale.  It was purchased by Marshall herself, but it is unclear how much she paid for it or how much it was worth on the open market.

Thereafter, Marshall sued the Sostarics for the deficiency--i.e., over $175,000.  It appears that Marshall filed a “motion for judgment,” which the trial court treated as a motion for summary judgment.  At that point the Sostarics filed a response, but without any affidavits or any other evidentiary materials.  The trial court concluded that the summary judgment motion was properly supported and that the Sostarics had failed to meet their burden in opposing the motion.  Accordingly, judgment was entered for the full amount that was alleged to be due and owing.

Positions of the Parties: 

Petitioners (Nancy and Stjepan Sostaric)

In their pro se brief, the Sostarics make two basic arguments.

First, they complain that the trial court did not sufficiently protect their rights as pro se litigants.  Quoting Bego v. Bego, 177 W.Va. 74, 350 S.E.2d 701, (1986) they point out that the trial court has an affirmative duty to “insure that no person’s cause or defense is defeated by reason of their unfamiliarity with procedural or evidentiary rules.”  Therefore, the trial court erred when it entered judgment without informing them of how their response to the summary judgment motion was deficient.

There is also a substantive issue raised although, again, it is difficult to gauge exactly what it is.  Primarily, the Sostarics complain that they did not receive proper credit for the value of the property that was sold and, as a consequence, Marshall was unjustly enriched.

Respondent (Sally Marshall):

According to Marshall, the trial court did, in fact, instruct both parties regarding the summary judgment process.  Nothing more was required:  “Wishing for a different…outcome does not mean the Sostarics were not treated as pro se litigants.”

Regarding the substantive issue, Marshall cites Fayette County Nat’l Bank v. Lilly, 199 W.Va. 349, 484 S.E.2d 232 (1997) for the proposition that “a [property owner] may not assert, as a defense in a deficiency judgment proceeding, that the fair market value of real property was not obtained at a trustee foreclosure sale.”

Probable Impact: 

As noted, the Supreme Court has given this appeal Rule 20 status.  It is not expected that any opinion in this case will have widespread impact.  However, we can expect a new syllabus point addressing the procedural issue, the substantive issue, or both.

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