FCDB LBPL 2008-1 Trust v. Remely
2013 Ohio 4960
Ohio Ct. App.2013Background
- FCDB LBPL 2008-1 Trust filed a foreclosure complaint; service was perfected August 12, 2011.
- Appellants (Celene and Roger Remely) obtained a pro se extension to September 30, 2011 to secure counsel but did not file a timely answer; counsel filed an answer October 31, 2011 which was stricken.
- Appellee moved for default judgment; appellants moved for leave to plead instanter and the court scheduled a March 12, 2012 hearing.
- The court conditioned granting leave to answer on appellants’ cooperation with court-ordered foreclosure mediation and timely financial disclosures; appellants agreed to cooperate.
- Mediator reported appellants failed to cooperate; the trial court denied leave to plead instanter, later held a hearing on default, and granted appellee’s motion for default judgment.
- Appellants appealed, arguing abuse of discretion in denying leave to plead and in entering default judgment; one judge dissented, arguing mediator communications were privileged absent an express waiver.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether trial court abused discretion denying motion for leave to file answer instanter (Civ.R. 6(B)(2)) | Remelys missed deadline without showing excusable neglect; court properly conditioned relief on mediation cooperation | Remelys contend they can show excusable neglect and complied sufficiently to avoid default | No abuse of discretion; denial affirmed because defendants failed to comply with court-ordered mediation conditions and did not demonstrate excusable neglect |
| Whether default judgment was entered without required notice/hearing under Civ.R. 55(A) | Plaintiff says notice and hearing were given and required procedure followed | Defendants claim no full evidentiary hearing and challenge sufficiency/standing of plaintiff | Court found defendants appeared, received notice, and a hearing occurred (transcript not provided); default affirmed |
| Whether defendants can attack the substantive sufficiency (standing/holder status) of plaintiff's complaint after default | Plaintiff relied on mortgage, assignments, and note (bearer paper) to show standing | Defendants argued lack of standing/real party in interest and improper chain/possession | Substantive defenses are precluded after default; plaintiff had attached documents establishing presumptive standing |
| Whether mediator communications informing the court of defendants’ noncooperation violated mediation privilege | Plaintiff relied on mediator affidavit to show failure to cooperate | Defendants contend mediator communications were privileged and no express waiver occurred | Majority upheld court’s reliance on mediator affidavit; dissent argued reliance violated R.C. 2710 and would reverse |
Key Cases Cited
- Davis v. Immediate Medical Serv., Inc., 80 Ohio St.3d 10 (1997) (defendant who defaults generally cannot later litigate merits; rules enforce timely answers)
- Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13 (2012) (standing to foreclose requires being the real party in interest at commencement)
- Fed. Home Loan Mtge. Corp. v. Rufo, 983 N.E.2d 406 (2012) (holder status and right to enforce note relevant to foreclosure standing)