Huntington Natl. Bank v. Brown
2014 Ohio 2649
Ohio Ct. App.2014Background
- In Jan. 2008 Brown signed a $417,000 promissory note secured by a mortgage in favor of Real Estate Mortgage Corporation; MERS was listed as mortgagee/nominee. The note and mortgage were assigned to Huntington on Aug. 26, 2009, with the assignment recorded Sept. 4, 2009.
- Huntington filed a foreclosure complaint Aug. 31, 2009, attaching copies of the note, mortgage, and an assignment purportedly executed by MERS transferring the mortgage to Huntington.
- Procedural history: Brown moved for summary judgment arguing Huntington lacked standing; magistrate initially granted Brown summary judgment after excluding Huntington’s late-submitted endorsement page. The trial court sustained Huntington’s objections, returned the matter, and ultimately the magistrate and trial court granted Huntington summary judgment. Brown appealed.
- Huntington submitted an affidavit from a Huntington officer stating the original note was endorsed in blank and in Huntington’s possession prior to filing the complaint; Huntington later produced the endorsement page during summary-judgment briefing.
- The trial court held Huntington was the real party in interest because (a) MERS, as mortgagee/nominee, could assign the mortgage, and (b) Huntington was the holder of the note (endorsement in blank) at the time the foreclosure complaint was filed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MERS had authority to assign the mortgage to Huntington | MERS was mortgagee/nominee and thus empowered to assign the mortgage to Huntington | MERS lacked authority to assign, so assignment was invalid and Huntington lacked standing | Court: MERS, as mortgagee and nominee, had authority to assign; assignment valid |
| Whether Huntington was holder/real party in interest at filing | Huntington possessed the original note endorsed in blank before filing, so it was holder and had standing | Huntington failed to attach endorsement to original complaint and thus lacked standing at filing | Court: Endorsement in blank and affidavit established Huntington held the note at filing; subsequent production of endorsement during summary judgment was permissible; Huntington had standing |
Key Cases Cited
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102 (summary-judgment standard and de novo review)
- State ex rel. Duganitz v. Ohio Adult Parole Auth., 77 Ohio St.3d 190 (summary-judgment standard)
- Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13 (party has standing in foreclosure if mortgage assigned or is holder of note at filing)
- CitiMortgage, Inc. v. Patterson, 984 N.E.2d 392 (reinforcing Schwartzwald standard on standing in foreclosure)