U.S. Bank, N.A. v. Jones
2016 Ohio 7168
| Ohio Ct. App. | 2016Background
- In 2003 Krista Jones executed a promissory note and mortgage to Wells Fargo Home Mortgage; the loan was later modified. Wells Fargo allegedly assigned the note and mortgage to U.S. Bank in 2012.
- U.S. Bank filed a foreclosure complaint in August 2015 asserting the original note was lost and attaching a lost-note affidavit (executed by Wells Fargo) and other loan documents.
- U.S. Bank moved for summary judgment, submitting an affidavit of judgment (from a Wells Fargo officer) and copies of the note, lost-note affidavit, modification, mortgage, and assignment; it alleged Jones defaulted.
- Jones opposed summary judgment, arguing U.S. Bank failed to prove it was in possession of the note when it was lost (R.C. 1303.38(A)(1)) and sought discovery about Wells Fargo’s role.
- The trial court granted U.S. Bank summary judgment and entered foreclosure; Jones’ motion to reconsider (seeking leave to depose the affiant) was denied.
- On appeal the Third District reversed, holding the record did not establish U.S. Bank was in possession of the note and entitled to enforce it when loss of possession occurred as required by R.C. 1303.38(A)(1).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether U.S. Bank proved it was entitled to enforce a lost note under R.C. 1303.38(A)(1) | U.S. Bank presented the lost-note affidavit, affidavit of judgment, assignment, and business records showing it was the assignee/holder and the loan was in default | Jones argued the lost-note affidavit identifies Wells Fargo as the lawful owner and does not show U.S. Bank was in possession or entitled to enforce the note when it was lost; U.S. Bank failed to show timing of loss or Wells Fargo’s role when loss occurred | Reversed: U.S. Bank did not prove it was in possession of the note and entitled to enforce it when loss occurred, so it was not entitled to enforce under R.C. 1303.38(A)(1) |
| Whether summary judgment standard was met on foreclosure elements | U.S. Bank maintained it had evidentiary materials showing holder/assignee status, default, and amounts due | Jones maintained material factual dispute about who possessed and owned the note when it was lost, precluding summary judgment | Reversed: genuine issue exists on possession/entitlement to enforce; summary judgment inappropriate |
| Whether plaintiff satisfied the statutory requirement to protect the mortgagor from competing claims under R.C. 1303.38(B) | U.S. Bank relied on its affidavits and attachments without further showing of protections | Jones argued the court could not enter judgment without findings regarding adequate protection against competing claims because ownership/possession was unclear | Not reached as dispositive error was failure to prove entitlement under (A)(1); appellate court reversed summary judgment |
| Whether denial of discovery (deposition of affiant) was proper | U.S. Bank argued its affidavits and records sufficed for summary judgment | Jones sought leave to depose the Wells Fargo affiant to resolve when loss occurred and Wells Fargo’s role | Not addressed on merits: rendered moot by reversal of summary judgment |
Key Cases Cited
- Hillyer v. State Farm Mut. Auto. Ins. Co., 131 Ohio App.3d 172 (8th Dist. 1999) (appellate review of summary judgment is de novo)
- Diamond Wine & Spirits, Inc. v. Dayton Heidelberg Distrib. Co., 148 Ohio App.3d 596 (3d Dist. 2002) (appellate court may affirm correct judgment despite erroneous reasoning below)
- Murphy v. City of Reynoldsburg, 65 Ohio St.3d 356 (Ohio 1992) (doubts on summary judgment are resolved for the nonmoving party)
- Dresher v. Burt, 75 Ohio St.3d 280 (Ohio 1996) (movant’s burden on summary judgment and nonmoving party’s responsive burden)
- Dennis Joslin Co., LLC v. Robinson Broadcasting Corp., 977 F. Supp. 491 (D.D.C. 1997) (interpreting the lost-note enforcement requirement under UCC Section 3-309)