Recently, Fannie Mae made the news regarding Pennsylvania Ejectment actions. Federal National Mortgage Association (“FNMA”), most commonly known as “Fannie Mae,” is a government sponsored enterprise established by Congress to provide stability in the secondary market for residential mortgages. 12 U.S.C. § 1716(2). In Fannie Mae v. Janczak, 2021 Pa. Super 10 (Jan. 2021), FNMA initiated an ejectment action in the name of “Fannie Mae.” Janczak, an occupant for a properly foreclosed upon property, challenged the FNMA’s standing to sue under the fictitious name of “Fannie Mae” in violation of the Pennsylvania Fictitious Name Act, 54 Pa. C.S.A. §§ 201-322 (“Act”). Under the Act, “[n]o entity which has failed to register a fictitious name as required by this chapter shall be permitted to maintain any action in any tribunal of this Commonwealth until such entity shall have complied with the provisions [of the Act.]” 54 Pa. C.S.A. § 331(a).
FNMA argued that under 12 U.S.C. §1723a(a), FNMA was authorized to conduct regular business under the fictitious name of “Fannie Mae” “without regard to any qualification or similar statute in any State of the United States, including District of Columbia, the Commonwealth of Puerto Rico, and the Territories and possessions of the United States[. . .]” (see 12 U.S.C. §1723a(a)) and that under FNMA’s bylaws, “[while t]he name of the corporation is Federal National Mortgage Association[, FNMA] may also do business under the name Fannie Mae.” Fannie Mae Bylaws, Art. 1, Sec. 101, as amended through Jan. 29, 2019. FNMA further argued that the Act is contrary to the Supremacy Clause of the United States Constitution. Janczak, 2021 Pa. Super 10 (Jan. 2021).
The Court found that under the plain meaning of the FNMA Charter, FNMA shall only “sue and be sued, and to complain or defend” under its corporate name, Federal National Mortgage Association. See 12 U.S.C. §1723a(a). The Court reasoned that while FNMA’s Charter allows FNMA to regularly “conduct its business without regard to any qualification or similar statute in any State of the United States, including District of Columbia, the Commonwealth of Puerto Rico, and the Territories and possessions of the United States[. . .]” (id.), “the language of the statute is plain and unambiguous with regard to the name in which it is empowered to commence suit in a court of law – its corporate name[,]” Federal National Mortgage Association. Janczak, 2021 Pa. Super 10 (Jan. 2021) citing 12 U.S.C. § 1723a(a). The takeaway from this case is that it is important to use proper designations and descriptions of Plaintiff’s in Pennsylvania ejectment cases.
If you have any questions regarding ejectments in Pennsylvania, please reach out to Jessica Manis, Esquire.