2014 Ohio 881
Ohio Ct. App.2014Background
- Freedom Mortgage filed for foreclosure against Howard and Bonnie Milhoan; all defendants were defaulted and the court granted default judgment.
- Sheriff’s sale occurred on November 13, 2012; appellants Richard and Hilda Boston were high bidders and paid the deposit; sheriff returned the sale on November 15.
- Nearly seven weeks later, on December 31, Freedom moved to vacate the sale under R.C. 2329.27(B)(1), arguing it failed to serve and file statutorily required written notice of the sale.
- Trial court granted the bank’s proposed entry on January 4, 2013, vacating the sale and ordering return of the Bostons’ deposit; the bank later scheduled a new sale.
- The Bostons moved to intervene (timely) arguing the bank misapplied R.C. 2329.26(A) because service and filing of written notice are excused where parties are in default; the trial court denied intervention and the Bostons appealed.
Issues
| Issue | Plaintiff's Argument (Freedom) | Defendant's Argument (Bostons) | Held |
|---|---|---|---|
| Whether failure to serve and file written notice under R.C. 2329.26(A)(1)(a) voids the sheriff’s sale | Sale was defective and void because plaintiff did not serve written notice on parties nor file a copy with the clerk | Service on defaulted parties is excused by R.C. 2329.26(A)(1)(b); if no written notice was required, nothing was required to be filed | Court: Bank misapplied statute; (A)(1)(b) excuses both service and filing when parties are in default, so sale was not void on that basis |
| Whether strict compliance with the filing requirement in R.C. 2329.26(A)(1)(a)(ii) is mandatory and renders a sale void post-sale | Strict compliance is required; failure to file a copy of the notice with proof of service invalidates sale | Strict compliance not mandated; confirmation statute contemplates cure or judicial finding of no prejudice | Court: Strict compliance is not required; statutory text and precedent show sale is not necessarily void for filing failures and (A)(1)(b) applies |
| Whether purchasers at an unconfirmed sheriff’s sale may intervene as of right under Civ.R. 24(A)(2) | Purchaser has no vested interest until confirmation and thus cannot claim the required interest to intervene | Purchasers have a legally protectable interest in the proceedings and may be impaired if sale is vacated; intervention is timely and necessary to protect that interest | Court: Bostons have a legally protectable interest for Civ.R. 24(A)(2); denial of intervention was an abuse of discretion |
| Alternatively, whether permissive intervention under Civ.R. 24(B) should have been allowed | Intervention would unduly delay or prejudice the bank; purchasers have no common question of law/fact | Intervention would not unduly delay/prejudice; Bostons’ claims raise common questions (statutory compliance) and would not unduly delay resolution | Court: Permissive intervention also should have been granted; denial was an abuse of discretion |
Key Cases Cited
- Ohio Savings Bank v. Ambrose, 56 Ohio St.3d 53 (Ohio 1990) (purchaser has no vested property right prior to confirmation but has some procedural interest in proceedings)
- State ex rel. Midwest Pride IV, Inc. v. Pontious, 75 Ohio St.3d 565 (Ohio 1996) (purchaser’s ability to participate depends on intervention; no automatic right to a hearing absent intervention)
- Gehm v. Timberline Post & Frame, 112 Ohio St.3d 514 (Ohio 2007) (limits on immediate appealability of certain intervention denials; discussed distinction for special proceedings)
- Hall v. Trapper John’s Canoe Livery, Inc., 115 Ohio App.3d 162 (Ohio Ct. App.) (parties in default are not entitled to post-sale notice and court erred granting relief where notice to defaulted parties was not required)
- Reed v. Radigan, 42 Ohio St. 292 (Ohio 1884) (historical discussion that purchasers in jurisdictions requiring confirmation obtain no vested rights until confirmation)
- Allen’s Lessee v. Parish, 3 Ohio 187 (Ohio 1827) (statutory prerequisites to sale do not necessarily render a confirmed sale void)