CitiMtge., Inc. v. Loncar
2013 Ohio 2959
Ohio Ct. App.2013Background
- 2008: Randy Loncar and Patricia Loncar (individually and as Trustee of the Lauren Ann Loncar and Macy Lynn Loncar Family Trust) executed a $217,500 promissory note and mortgage on residential property at 200 Russo Dr., Canfield, Ohio; Home Savings & Loan Co. was the original lender.
- January 14, 2011: CitiMortgage filed a foreclosure complaint, attaching the note endorsed to CitiMortgage (CitiMortgage was in possession of the note when suit was filed).
- February–March 2011: Home Savings & Loan executed and recorded an assignment of the mortgage to CitiMortgage (assignment occurred after filing but before judgment).
- Defendants answered alleging (1) CitiMortgage lacked standing because it had not been assigned the mortgage when it filed suit, and (2) the required notice of default/acceleration was not properly given to the Trust.
- CitiMortgage moved for summary judgment, submitting an affidavit from its document-control officer and the notice-of-default letter; Loncar submitted an affidavit denying receipt of the notice.
- Trial court granted summary judgment and decree of foreclosure; Loncars appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiff had standing to file foreclosure when mortgage assignment occurred after filing | CitiMortgage was holder of the promissory note at filing and thus entitled to enforce the note; holder status suffices for standing even if mortgage assignment was recorded later | Loncars: standing requires assignment of both note and mortgage at time of filing; post-filing assignment cannot cure lack of standing | Court held CitiMortgage had standing because it was the holder of the note at filing; holder of note has equitable interest in the mortgage and may sue to foreclose |
| Whether notice of default/acceleration was properly given to all borrowers (including the Trust) | CitiMortgage: sent notice addressed to Randy and Patricia at property address; mortgage/note treat notice to one borrower as notice to all; affidavit and attached letter establish compliance | Loncars: Patricia (as Trustee) swore she did not receive the notice and the Trust was not specifically named as addressee | Court held CitiMortgage presented sufficient, authenticated evidence (affidavit + notice) that notice was served as required by the note/mortgage; notice to one borrower sufficed for all borrowers |
Key Cases Cited
- Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13 (2012) (holding lack of standing at commencement of action cannot be cured by post-filing assignment before judgment)
- CitiMortgage, Inc. v. Patterson, 984 N.E.2d 392 (8th Dist. 2012) (held holder of the note may have standing to foreclose even if mortgage assignment occurred after filing)
- Kernohan v. Manss, 53 Ohio St. 118 (1895) (explains that the note represents the debt secured by the mortgage and transfer of the note carries equitable ownership of the mortgage)