2015 Ohio 4636
Ohio Ct. App.2015Background
- Green Tree Servicing filed a foreclosure complaint asserting it was entitled to enforce a promissory note and mortgage securing $132,000 plus interest; copies of the note and mortgage were attached.
- The note (June 19, 2007) bore a stricken, initialed indorsement “without recourse” to Wells Fargo Bank marked “VOID.”
- An allonge attached to the note contained a chain of undated indorsements from MortgageIT to Countrywide Bank FSB, to Countrywide Home Loans, Inc., and ending in a blank indorsement.
- Mortgage assignments for the mortgage showed transfers from MortgageIT/MERS to Bank of America (2012), then to Green Tree (2013).
- Green Tree moved for summary judgment, supported by an affidavit averring possession of the note and mortgage; Brandt did not oppose the motion and appealed after judgment foreclosing his interest.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a voided (stricken) indorsement on the note creates a genuine issue as to negotiability or holder’s standing to enforce the note | Green Tree argued the stricken indorsement is a nullity and the allonge chain establishes it as holder entitled to enforce the note | Brandt argued the voided indorsement raises doubt who may enforce the note (suggesting Wells Fargo might be the proper holder) and the trial court needed evidence explaining the voided mark | The court held a voided/cancelled indorsement, without more, does not create a genuine issue of material fact; the stricken endorsement is a nullity and Green Tree’s evidence established holder status |
Key Cases Cited
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 671 N.E.2d 241 (1996) (standard of review for summary judgment is de novo)