U.S. Bank Natl. Assn. v. Minnillo
2012 Ohio 5188
Ohio Ct. App.2012Background
- Plaintiff-bank U.S. Bank seeks foreclosure and appointment of a receiver for the Murray Hill Rd. property in Cleveland under a mortgage and note allegedly originated in 2007.
- Minnillos allegedly defaulted on the promissory note; the note was asserted to be owned/held by the bank as trustee for Lehman Brothers Small Balance Commercial Mortgage Pass-Through Certificates, Series 2007-3.
- Mortgage was executed by Minnillos in favor of GreenPoint, later assigned to Aurora Bank, which then assigned to U.S. Bank; assignments recorded around 2012.
- Bank filed motion to appoint a receiver contemporaneously with its complaint; it supported with an affidavit from Michelle Rish stating records were kept in the ordinary course.
- Minnillos opposed, arguing questions about who holds the note; they hired TILA Solutions to audit, claiming the bank’s ownership of the note was dubious.
- Trial court granted the receiver appointment, finding default, mortgage encumbrance, and proper assignment, and citing RC 2735.01 and the mortgage terms.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether appointing a receiver was proper under RC 2735.01 and mortgage terms. | U.S. Bank argues default and mortgage terms authorize receiver appointment. | Minnillos contend no clear danger or insufficiency to discharge debt; reliance on RC 2735.01 challenged. | Appointing a receiver affirmed; consent language and case law support it. |
| Whether U.S. Bank proved it was the holder of the note. | Bank alleged ownership as Trustee for Series 2007-3 with an allonge showing transfer to U.S. Bank. | Minnillos claim no evidence of holder status; insufficient proof of trust/ownership. | Holding established by complaint and allonge; bank properly shown as owner/holder. |
Key Cases Cited
- Malloy v. Malloy Color Lab, Inc., 63 Ohio App.3d 434 (10th Dist.1989) (receivership standard for preservation of rights)
- Cross v. Ledford, 161 Ohio St. 469 (1954) (clear and convincing standard; appellate review of discretion)
- Huntington Natl. Bank v. Prospect Park LLC, 2011-Ohio-5391 (8th Dist.) (consent to receiver via mortgage terms; held not abuse of discretion)
- Harajli Mortgage & Investment, Inc. v. A&M Invest. Strategies, Inc., 2006-Ohio-3052 (6th Dist.) (waiver of notice through mortgage provision)
- State v. Calhoun, 86 Ohio St.3d 279 (1999) (affidavit sufficiency understanding)