BAC Home Loans Servicing LP v. Busby
2013 Ohio 1919
Ohio Ct. App.2013Background
- BAC filed a foreclosure complaint on December 22, 2009 in Montgomery County, alleging the Busbys defaulted on a note and mortgage for 251 Trumpet Drive and seeking judgment, foreclosure, and sale.
- The complaint attached the note showing Countrywide Bank, FSB as original lender; an allonge indicated transfer to BAC; signature by Rhoena Rice with a Vice President stamp.
- Exhibit B’s open-end mortgage listed MERS as mortgagee for Countrywide; Exhibit C assigned the mortgage from MERS to BAC one week before suit.
- Busbys were personally served and failed to answer; BAC obtained a default judgment on February 4, 2010, with foreclosure and sale scheduled.
- Busbys moved June 23, 2010 to vacate the void judgment, asserting lack of standing and RESPA-based QWR issues; hearing occurred October 28, 2010; November 2, 2010 order denied; no timely appeal.
- In June 2012 Busbys filed an amended motion to vacate; the trial court treated it as a Civ.R. 60(B) motion and denied relief; Busbys appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether BAC had standing/real party in interest to foreclose | Busbys lack standing; BAC failed to prove proper ownership of note/mortgage. | Busbys contend BAC lacked standing due to defective assignments and robo-signing; standing cannot be assumed. | BAC had facially valid standing based on attached note, allonge, and assignment; judgment not void for lack of standing. |
| Whether Civ.R. 60(B) relief was available and timely | 60(B) motion untimely and lacking merit; amendments merely reiterate merits-based defenses. | Motion timely as newly discovered evidence and other grounds; relief warranted due to prior denial and fraud. | Amended 60(B) motion was untimely and lacked a meritorious basis; no relief from judgment. |
| Whether Busbys could use RESPA QWR issues as a meritorious defense | Busbys’ RESPA claims negate BAC’s standing/ownership by suggesting failure to respond to QWRs. | RESPA violations could excuse or excuse foreclosure; discovery of QWR issues defeats foreclosure. | RESPAs violations did not establish a meritorious defense to the foreclosure or void the judgment. |
Key Cases Cited
- Kincaid v. Erie Ins. Co., 128 Ohio St.3d 322 (2010-Ohio-6036) (standing is a jurisdictional concept, not subject matter jurisdiction)
- Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13 (2012-Ohio-5017) (standing is jurisdictional and cannot be cured post-suit)
- GTE Auto. Elec., Inc. v. ARC Indus., Inc., 47 Ohio St.2d 146 (1976) (three-part Civ.R. 60(B) test for relief from judgment)
- Byard v. Byler, 74 Ohio St.3d 294 (1996) (standing/real party in interest may be raised as to foreclosure actions)
- Wells Fargo Bank, N.A. v. Brandle, 2012-Ohio-3492 (2d Dist. Champaign) (60(B) relief not available for merits-based foreclosure defenses)
- Herring v. GMAC Mortgage, 189 Ohio App.3d 200 (2010-Ohio-3650) (fraud in ownership defense not grounds for Civ.R. 60(B) relief)