The opinion of the court was delivered by: William J. Martini Judge
This matter comes before the Court on Defendant's 12(b)(6) motion to dismiss for failure to state a claim and for improper service. Also before the Court is pro-se Plaintiffs' Rule 56 motion for partial summary judgment as to violations of Pennsylvania usury statutes. The motions are both opposed and the Court adjudicates this matter on the papers. Fed. R. Civ. P. 78. For the reasons stated below, the Plaintiff's motion is DENIED, Defendant's motion is GRANTED and the Complaint is DISMISSED.
Plaintiffs are a married couple who contend they were lifelong friends with married Defendants Thomas and Bonnie Kubicka. During a period from 1978-1993 Defendants loaned Plaintiffs a total of $28,700 at a range of interest rates, the highest of which was 18%; Plaintiffs signed notes for each loan. Plaintiffs made interest-only payments on these notes until March 24, 1994 at which point they stopped paying altogether. On February 25, 1998, Plaintiffs filed for Chapter 13 bankruptcy; the bankruptcy was dismissed. On June 4, 1999, the Kubickas filed an action against the Kramers in the Buck's County, Pennsylvania, Court of Common Pleas demanding the total outstanding on the notes plus interest for a total of $53,187.20.
Default Judgment was entered against the Kramers in that Pennsylvania action on September 3, 2000 and the Kramers wrote the Kubickas a $59,500 check, dated May 16, 2001, for the total judgment in that case; the check was cashed May 18, 2001. Satisfaction was entered in Pennsylvania on July 3, 2001 and in New Jersey on August 7, 2001. The Kramers allege that error of counsel led to their default, but they made no attempt to challenge or re-open judgment in the Pennsylvania case before writing their check satisfying the judgment.
Plaintiffs filed their Complaint with this Court on May 18, 2005 and amended it on September 13, 2005 and October 27, 2005. Plaintiff's claim violation of New Jersey and Pennsylvania usury statutes, and violations of the federal Racketeer Influenced and Corrupt Organizations Statute and Truth in Lending Act. They seek reimbursement of payments made, along with statutory and other damages.
Process was served on Defendant's residence in Pennsylvania; however Defendants were out of the country and service was accepted by a foreign national residing in their house on a "home exchange" program, who turned over the papers to Defendants when they returned 20 days later.
Defendants filed their motion to dismiss pro-se on October 7, 2005 for failure to state a claim and asserting insufficient service.*fn1 On November 28, 2005, Plaintiffs filed their motion for summary judgment on Count XV for relief under Pennsylvania's usury laws. On December 12, 2005, Defendants, now with attorney representation, responded in opposition to Plaintiff's motion for partial summary judgment and in support of Defendants' motion to dismiss.
I. Standard for Summary Judgment Pursuant to Rule 56
Summary judgment is appropriate if there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. See Fed. R. Civ. P. 56. Rule 56(e) requires that when a motion for summary judgment is made, the nonmoving party must set forth specific facts showing that there is a genuine issue for trial. See id.; see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. Only disputes over facts that might affect the outcome of the lawsuit under governing law will preclude the entry of summary judgment. See Anderson, 477 U.S. at 247-48. If the evidence is such that a reasonable fact-finder could find in favor of the nonmoving party, summary judgment should not be granted. See id.; see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). The Court recognizes the long-standing practice of construing pro-se plaintiffs' pleadings liberally, and gives Plaintiffs every benefit of the doubt in its considerations. See, e.g. U.S. v. Miller, 197 F.3d 644, 648 (3d Cir. 1999).
II. Defendant's Motions to Dismiss are Converted to Motions for Summary Judgment
The rule in evaluating a motion to dismiss is that if matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56 and all parties shall be given a reasonable opportunity to present all material made pertinent to such a motion by Rule 56. Fed. R. Civ. P. 12(b); accord Rose v. Bartle, 871 F.2d 331, 340-42 (3d Cir. 1989). The Third Circuit has cautioned that express notice should generally be given before the Court converts a motion to dismiss into one for summary judgment. See, e.g., In re Rockefeller Ctr. Prop., Inc. Secs Litig., 184 F.3d 280, 288 (3d Cir. 1999). However when the parties are on sufficient notice of potential conversion and the opposing party is not prejudiced by such conversion, such express notice by the Court is not necessary. See Carver v. Plyer, 115 Fed. Appx. 532, 536-37 (3d Cir. 2004); Hilferty v. Shipman, 91 F.3d 573, 578-79 (3d Cir. 1996). Likewise, when an issue is fully developed in response to a motion for summary judgment, a Court may grant summary judgment for the opposing party when appropriate. See Gibson v. Mayor and Council of the City of Wilmington, 355 F.3d 215, 224 (3d Cir. 2004).
In the instant case, pro-se Plaintiffs have submitted voluminous pleadings, including affidavits, charts, documentation related to the Pennsylvania action and other evidence both in support of their motion for partial summary judgment and in opposition to Defendants' motion to dismiss. Conversion therefore is appropriate, and would not prejudice Plaintiffs. Accordingly, ...