Farmers State Bank v. Sponaugle
2017 Ohio 4322
| Ohio Ct. App. | 2017Background
- Steven and Karen Sponaugle defaulted on three mortgage loans from The Farmers State Bank; the bank filed foreclosure in Oct. 2013.
- The parties executed a May 21, 2014 agreed-judgment entry: the court would enter money judgment and Sponaugles had until Aug. 23, 2014 to pay $120,000 to avoid foreclosure; failure to pay would lead to foreclosure and sale.
- Sponaugles did not pay; after procedural activity (including summary judgment to the bank and a January 12, 2016 "Judgment Entry–Decree of Foreclosure" that set lien priorities but did not state amounts for the county tax lien and a certificate-of-judgment lien), the trial court ordered a sheriff’s sale.
- The Sponaugles appealed; this court issued a show-cause and then dismissed the appeal in Apr. 2016, holding the Jan. 12 decree was not a final, appealable order because it failed to determine amounts due on all liens.
- A sheriff’s sale occurred Feb. 26, 2016; the trial court later confirmed the sale and ordered distribution on Apr. 21, 2016. The Sponaugles appealed that confirmation order.
Issues
| Issue | Plaintiff's Argument (Sponaugle) | Defendant's Argument (Farmers) | Held |
|---|---|---|---|
| Whether the trial court could order and confirm sale absent a final, appealable decree of foreclosure | Execution and confirmation on a non-final foreclosure decree is improper; sale violated due process and statutory execution rules | The Jan. 12 decree was final; R.C. 2329.09 permits sale; Sponaugles waived objections by agreed judgment | Court: Jan. 12 decree was not final (law of the case); confirming sale without a final decree was error — sale confirmation reversed and remanded |
| Whether the May 21, 2014 settlement waived Sponaugles’ objections to sale mechanics | Settlement did not waive requirement of a subsequent judgment of foreclosure and statutory sale procedures | Settlement terms allowed foreclosure and sale; Sponaugle waived defects | Court: Settlement did not waive requirement of final foreclosure decree and statutory compliance |
| Whether failure to determine amounts for all lienholders prevents execution | A decree that does not determine amounts owed to all claimants is not final and cannot be executed | Some lien amounts (e.g., taxes, certificate of judgment) are inherently ministerial and may be calculated at confirmation; decree stated lien priorities | Court: Execution requires a final, appealable decree resolving all claims; confirming sale before finality was error |
| Remedy following erroneous confirmation | Vacate confirmation, return deed, remand for further proceedings; sale cannot stand absent final decree | Argued any error was harmless given outcome and summary-judgment rulings | Court: Reversed confirmation; instructed trial court to vacate confirmation and return deed; sale may proceed only after final, appealable decree |
Key Cases Cited
- Nolan v. Nolan, 11 Ohio St.3d 1 (law of the case doctrine governs consistency between appellate and trial proceedings)
- Marion Production Credit Assn. v. Cochran, 40 Ohio St.3d 265 (a foreclosure decree that leaves claims unresolved is not final; execution should be stayed until final determination)
- Roach v. Roach, 164 Ohio St. 587 (a judgment lien requires a final judgment for a definite amount collectible by execution)
- CitiMortgage, Inc. v. Roznowski, 139 Ohio St.3d 299 (for a foreclosure decree to be final it must address rights of all lienholders and mortgagor responsibilities; specific computations may be ministerial at confirmation)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (abuse of discretion standard)
- Denham v. New Carlisle, 86 Ohio St.3d 594 (dismissal of remaining claims can render prior interlocutory orders final)