Wiltshire Capital Partners v. Reflections II, Inc.
2020 Ohio 3468
Ohio Ct. App.2020Background
- Wiltshire Capital Partners sued to foreclose a mortgage on a 0.450-acre parcel owned by Ohio Wholesale Auto Sales; Wiltshire alleged default but initially did not attach the note or name the maker.
- The mortgage chain of record showed an original mortgage (1995) assigned to Florence Odita (1998) and assigned to Wiltshire (2015); assignments were recorded.
- In 1997–1998 the county prosecuted an in rem tax foreclosure under R.C. 5721.18(C); the property failed to sell at sheriff’s sale, was forfeited to the state, and the county auditor sold it at public auction in 1998 to Stanford Crockett, Jr., who received an auditor’s deed.
- Ohio Wholesale purchased from Crockett in 2015 and recorded a quitclaim deed; it moved for summary judgment arguing the 1998 auditor’s sale extinguished Wiltshire’s mortgage under R.C. 5723.12(B).
- Wiltshire opposed, citing sale advertisements that stated the sale was pursuant to an IN REM action under R.C. 5721.18(C) and warned the sale would be subject to liens and encumbrances; Wiltshire also later submitted the note and sought its own summary judgment.
- The trial court granted summary judgment to Ohio Wholesale (finding the mortgage extinguished) and denied Wiltshire’s SJ; the court of appeals reversed in part, holding R.C. 5723.12(C) — not (B) — governed and the auditor’s sale did not extinguish the mortgage, but affirmed denial of Wiltshire’s SJ because Wiltshire failed to prove it was the holder of the note.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 1998 auditor's sale extinguished Wiltshire's mortgage | Sale did not extinguish mortgage because sale arose from an in rem foreclosure under R.C. 5721.18(C); advertisements stated sale was subject to liens | Auditor's sale extinguished prior liens under R.C. 5723.12(B) and thus mortgage was gone | R.C. 5723.12(C) applies to sales following R.C. 5721.18(C); sale did not extinguish other liens, so mortgage survived (trial court erred) |
| Whether the trial court improperly relied on evidence or applied a statute retroactively | Wiltshire argued trial court relied on inapposite materials and retroactively applied a later statute version | Ohio Wholesale defended trial court's use of statutory language | Court rejected retroactivity claim as immaterial (statutory language identical); issue of evidentiary reliance was moot after holding on (C) vs (B) |
| Whether Wiltshire established entitlement to summary judgment (holder status) | Wiltshire claimed it was the holder of the note and entitled to foreclosure; later produced the note | Ohio Wholesale noted the note was payable to Golden & Meizlish and contained no indorsements, so Wiltshire did not prove holder status | Wiltshire failed to prove it was the holder or entitled to enforce the note; denial of Wiltshire’s SJ affirmed |
| Whether Ohio Wholesale could raise alternative SJ defenses on appeal (statute of limitations; lack of standing; mortgage lapse) | Wiltshire argued those defenses were not pleaded below and cannot support SJ on appeal | Ohio Wholesale urged alternative grounds for affirmance on appeal | Court refused to consider new grounds raised for the first time on appeal; parties must litigate SJ grounds in trial court |
Key Cases Cited
- Hudson v. Petrosurance, Inc., 127 Ohio St.3d 54 (2010) (summary judgment standard)
- Sinnott v. Aqua-Chem, Inc., 116 Ohio St.3d 158 (2007) (summary judgment standard)
- Dresher v. Burt, 75 Ohio St.3d 280 (1996) (moving party burden under Civ.R. 56)
- Mitseff v. Wheeler, 38 Ohio St.3d 112 (1988) (party must raise SJ grounds in trial court to permit meaningful response)
- Bank of Am., N.A. v. Kuchta, 141 Ohio St.3d 75 (2014) (distinguishing subject-matter jurisdiction from standing)
- Pratts v. Hurley, 102 Ohio St.3d 81 (2004) (subject-matter jurisdiction can be raised at any time)
- State ex rel. Carna v. Teays Valley Local School Dist. Bd. of Edn., 131 Ohio St.3d 478 (2012) (court must give effect to every word of a statute)
- Zumwalde v. Madeira & Indian Hill Joint Fire Dist., 128 Ohio St.3d 492 (2011) (courts may not delete or narrow statutory language)