M&T Bank v. Bozickovich
2017 Ohio 9101
| Ohio Ct. App. | 2017Background
- In 2005 Nicholas Bozickovich executed a $162,400 adjustable-rate promissory note; both Bozickovich and Louise Galati executed the mortgage on the Willoughby Hills property.
- Grange Bank specially endorsed the note to First Federal Savings Bank; First Federal later entered a servicing agreement with M&T Bank (appellee) in January 2010 granting M&T authority to service and sue on the loan.
- Mortgage assignments later routed the mortgage to Franklin Bank S.S.B., and ultimately to M&T; the assignment to M&T included a handwritten amendment adding Galati as a mortgagor.
- Appellants made payments initially but later defaulted after failing to pay property taxes; M&T paid the taxes and sought reimbursement, then filed foreclosure in January 2014.
- M&T moved for summary judgment attaching affidavits from bank officers (Wilson and O’Brien) and copies of the note, mortgage, servicing agreement; trial court found M&T a nonholder in possession entitled to enforce the note and granted foreclosure.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to enforce the note | M&T: as servicer and nonholder in possession it has the rights of a holder and may enforce the note | Bozickovich/Galati: M&T is not a holder (special endorsement to First Federal) and affidavits fail to prove M&T had possession before suit | Court: M&T is a nonholder in possession with rights of a holder; affidavits sufficed to show possession before filing; standing upheld |
| Sufficiency of affidavits (Civ.R.56(E)) | M&T: Wilson and O’Brien, as bank officers, have personal knowledge and business-records foundation | Defendants: Affiants lack personal knowledge and specific transfer proof | Court: Affidavits met Civ.R.56(E) standards (officers, review of records, routine business practice); personal knowledge may be inferred |
| Notice required by mortgage (paragraph 22/15) | M&T: notice to one borrower satisfies notice-to-all clause in mortgage | Defendants: Galati (mortgagor) was not given a separate default/acceleration notice | Court: Mortgage defined "Borrower" to include both; paragraph 15 makes notice to one borrower notice to all; no controlling law requiring separate notice to Galati |
| Validity of mortgage assignment (handwritten amendment) | M&T: assignment and amendment show conveyance and correction of omission | Defendants: Amendment renders assignment ineffective or altered, defeating M&T’s mortgage interest | Court: Delivery, acceptance, and intent existed; amendment to correct omission does not void the assignment |
Key Cases Cited
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102 (1996) (standard for appellate de novo review of summary judgment)
- Leibreich v. A.J. Refrigeration, Inc., 67 Ohio St.3d 266 (1993) (elements and standard for summary judgment under Civ.R.56)
- Fed. Home Loan Mtge. Corp. v. Schwartzwald, 979 N.E.2d 1214 (Ohio 2012) (plaintiff in foreclosure must present evidentiary materials showing it is holder or party entitled to enforce note)