Wilmington Savings Fund Society v. West
2019 Ohio 1249
Ohio Ct. App.2019Background
- Wilmington Savings Fund Society (successor to CitiMortgage) holds the promissory note and mortgage on property owned by Sheila and David West; the loan is HUD-insured.
- Wests filed for bankruptcy, executed and filed a Notice of Intent to Surrender the property, the trustee abandoned the property, and the Wests’ debts were discharged.
- Wilmington filed a foreclosure complaint in October 2014 after sending delinquency/face-to-face meeting correspondence and making a field visit; Wests did not respond.
- Wests defended, arguing Wilmington failed to comply with 24 C.F.R. §203.604(b) because the certified-letter/visit occurred after three full payments were delinquent and that timing is a condition precedent to foreclosure.
- Trial court found Wilmington had standing and the loan was in default but ruled Wilmington failed to make the required contact before three full monthly installments were unpaid and therefore dismissed the foreclosure claim; it also denied summary judgment and rejected reformation for lack of evidence.
- On appeal, the Fifth District addressed whether the timing in 24 C.F.R. §203.604(b) is mandatory or aspirational and whether Wilmington’s affidavit satisfied summary-judgment evidentiary requirements.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether lender complied with 24 C.F.R. §203.604(b) before filing foreclosure | Wilmington: it sent certified letter and made a property visit to arrange a face-to-face meeting prior to filing; thus complied | West: the letter/visit occurred after three full monthly installments were unpaid, and the Regulation’s timing is a mandatory condition precedent, barring foreclosure | Court: Timing is aspirational, not a jurisdictional condition precedent; requirement is satisfied if letter and visit occur before filing. Wilmington complied before filing. |
| Whether summary judgment evidence established holder/standing and default | Wilmington: Bardua affidavit and business records show possession of note, default, amounts due | West: affidavit insufficient or internally inconsistent; failed to prove compliance with HUD regulation | Court: Bardua affidavit met Wachovia standards; evidence established standing and default. Summary judgment should have been granted on foreclosure. |
| Whether acceleration occurred before compliance with §203.604(b) | Wilmington: acceleration occurred when complaint was filed (Oct. 14, 2014) | West: relied on pre-acceleration correspondence to argue earlier acceleration and untimely compliance | Court: correspondence did not show acceleration; filing accelerated debt; Wilmington’s letter and visit occurred before filing. |
| Reformation of the mortgage legal description | Wilmington: scrivener’s mutual mistake; Exhibit C (allegedly correct description) supports reforming mortgage | West: denied the allegation; no admissible evidence presented at trial | Court: Reformation requires clear and convincing evidence; Wilmington presented no admissible evidence at trial — claim properly denied. |
Key Cases Cited
- Smiddy v. Wedding Party, Inc., 30 Ohio St.3d 35 (summary judgment standard in Ohio)
- Temple v. Wean United, Inc., 50 Ohio St.2d 317 (procedural standards for summary judgment)
- Celotex Corp. v. Catrett, 477 U.S. 317 (moving party’s burden in summary judgment)
- Burkes v. Stidham, 107 Ohio App.3d 363 (definition of material/genuine factual disputes)
- Washington Mut. Bank v. Mahaffey, 154 Ohio App.3d 44 (mortgagee must show compliance with 24 C.F.R. §203.604 as condition precedent to foreclosure)
- U.S. Bank, N.A. v. Detweiler, 191 Ohio App.3d 464 (same jurisdiction; discussed §203.604 compliance requirements)