U.S. Bank Natl. Assn. v. Green Meadow SWS, L.L.C.
2013 Ohio 2002
Ohio Ct. App.2013Background
- Green MeadowSWS, LLC executed a $7.42M promissory note on May 23, 2006, secured by a loan package including an Article 12 nonrecourse provision with stated exceptions.
- Greggory R. Hardy executed a Guaranty guaranteeing obligations under Article 12; the mortgage package included an Open-End Mortgage and related security instruments.
- Green Meadow defaulted on November 1, 2009; Bank sent multiple default and information-request notices in 2010; Bank filed suit July 22, 2010 seeking foreclosure and damages.
- Receiver appointed in 2010; receiver sold the property for $4,401,915, with proceeds to be applied to the debt.
- Trial court granted summary judgment in favor of Bank in August 2012; Green Meadow and Hardy appealed; issue of surreply and standing became pivotal.
- Court of Appeals sustains in part, reverses in part, and remands for further proceedings consistent with its opinion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court erred in granting summary judgment on full-recourse liability against Green Meadow | Bank argued Green Meadow is recourse due to Reporting Default; non-recourse clause not applicable | Green Meadow argued non-recourse applies; no Reporting Default pleaded in complaint | Remanded; partial sustains; sale proceeds to be considered on remand |
| Whether the trial court properly denied leave to file a surreply to Bank’s reply | Bank’s reply raised new arguments; must be addressed by surreply | Surreply needed to prevent ambush and allow response | Reversible error to deny surreply; remand for consideration of surreply on Green Meadow claim |
| Whether the trial court erred in denying the Motion to Strike Reed affidavit and in denying standing issues | Reed affidavit supports standing and business-records; admissible under Civ.R. 56(E) and Evid.R. 803(6) | Reed lacks personal knowledge or proper standing; affidavit should be struck | No abuse of discretion; third assignment overruled |
Key Cases Cited
- Dresher v. Burt, 75 Ohio St.3d 280 (Ohio 1996) (summary judgment standard; Civ.R. 56 burden on movant)
- Buren v. Karrington Health, Inc., 2002-Ohio-206 (Ohio 2002) (reply briefs restrict to rebuttal; new arguments require surreply or strike)
- Lawson v. Mahoning Cnty. Mental Health Bd., 2010-Ohio-6389 (7th Dist. 2010) (reply may raise new arguments; need surreply to respond)
- Deutsche Bank Natl. Trust Co. v. Hansen, 2011-Ohio-1223 (5th Dist. 2011) (business records and personal knowledge under Civ.R. 56(E) and Evid.R. 803(6))