2018 Ohio 3728
Ohio Ct. App.2018Background
- Bank of New York Mellon (BONY) sued William and Joan Kohn in 2011 for foreclosure, alleging default and asserting assignment of the note and mortgage; the case was stayed for ~5 years for bankruptcy issues.
- BONY moved for summary judgment in Feb. 2017, submitting an affidavit from Nicholas Raab, an employee of Specialized Loan Servicing, LLC (SLS), BONY’s loan servicer.
- Raab averred familiarity with SLS business records, described the loan terms and default, attested that SLS integrates and verifies prior servicers’ records, and attached the payment history, notice of acceleration, and a modification agreement.
- The Kohns opposed and moved to strike Raab’s affidavit, arguing it was inadmissible hearsay and did not meet the Evid.R. 803(6) business‑records exception because the records were created by prior servicers and possibly untrustworthy (citing a consent decree against Bank of America).
- The trial court denied the motion to strike and granted summary judgment for BONY; the Seventh District affirmed, holding Raab’s affidavit and attached records met Evid.R. 803(6) requirements and were trustworthy.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of servicer affidavit to authenticate business records | Raab (SLS) has personal knowledge of SLS records, verifies prior‑servicer records are integrated and vetted, so affidavit authenticates records under Evid.R. 803(6). | Raab lacked firsthand knowledge of how prior servicers created records; affidavit is hearsay and cannot authenticate prior‑servicer documents. | Court held Raab’s affidavit and attached documents showed sufficient personal knowledge and authentication for business‑records exception. |
| Trustworthiness of records given prior consent decree against Bank of America | BONY: consent decree against Bank of America does not prove these specific records are untrustworthy; no evidence showing these exhibits are deficient. | Kohns: consent decree shows systemic recordkeeping problems, undermining trustworthiness of records BONY relies on. | Court held the consent decree alone did not establish lack of trustworthiness; defendants offered no evidence those specific records were unreliable. |
| Whether servicer relies on and uses prior‑servicer records in ordinary course | BONY: SLS integrates prior records into its files and relies on them for servicing; Raab and a welcome letter support regular use. | Kohns: SLS’s claimed reliance insufficient to authenticate records created by others. | Court found SLS’s routine integration and the welcome letter showed records were kept and used in the regular course of business. |
| Sufficiency of summary judgment proof on default/amount due | BONY: attached payment history, notice of acceleration, modification, and Raab affidavit establish default and amounts. | Kohns: challenge authenticity/accuracy of those documents due to hearsay/untrustworthiness. | Court concluded evidence as presented left no genuine issue of material fact; summary judgment for BONY affirmed. |
Key Cases Cited
- Cole v. Am. Indus. & Res. Corp., 128 Ohio App.3d 546 (Ohio Ct. App. 1998) (standard of review for summary judgment)
- State ex rel. Parsons v. Fleming, 68 Ohio St.3d 509 (Ohio 1994) (summary judgment standard and construing evidence for nonmoving party)
- Hoyt, Inc. v. Gordon & Assoc., Inc., 104 Ohio App.3d 598 (Ohio Ct. App. 1995) (materiality depends on substantive law)
- Anderson v. Liberty Lobby, 477 U.S. 242 (U.S. 1986) (summary judgment and genuine issue of material fact framework)
- Bank of New York Mellon for Certificate Holders CWABS, Inc. v. Broyles, 2018-Ohio-357 (7th Dist.) (servicer testimony and verification process can satisfy Evid.R. 803(6))